Bank of England
The Bank of England today maintained the Bank Rate at 0.5% and the size of the Asset Purchase Programme at £375 billion.
The Bank of England reduced its Bank Rate by 0.5 percentage points to 0.5% on 5 March 2009 and it has remained unchanged since.
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The announcement means that the base rate has been unchanged for over 4.5 years. Economists have forecast that this means it could be 2016 before the Bank of England base rate is increased however the Chancellor today disclosed that unemployment, a trigger for a base rate review, could fall faster than expected.
Governor Mark Carney has said in the past that the base rate will not be reviewed or increased until unemployment fell to 7%. However, today Chancellor George Osborne said in his Autumn Statement that a recovering UK economy could mean unemployment could fall to 7% or below by 2015, raising the prospect of a potential base rate rise then.
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