BOE qualifies its 7% unemployment benchmark

The Bank of England said Wednesday it would use 7 percent unemployment as a benchmark, but not an absolute one, for determining policy changes. Minutes to the central bank's Nov. 6-7 policy meeting qualify its view of the 7 percent threshold for policy change that it announced in August. In the second quarter, unemployment stood at 7.3 percent. Noting that economic growth would not likely "evolve exactly in line with the central projections, regardless of the conditioning assumption for Bank Rate," the bank said, "there could be a case for not raising Bank Rate immediately when the 7 percent unemployment threshold was reached." "Once unemployment had reached 7 percent, the Committee would reassess what it had learned about the nature of the recovery," the minutes read. "In the meantime, the Committee would continue to judge the appropriate stance for policy each month in line with the guidance given in August." The meeting minutes indicated that policymakers expected "four-quarter gross domestic product growth was expected to pick up further in the near term as the lifting of uncertainty and the thawing of credit conditions continued to bolster demand growth." Inflation is expected to stay close to its long-term target of 3 percent or under, with annual inflation, at 2.7 percent in September, sliding to 2.2 percent in October. Policymakers said that the country's "near-term outlook was a little stronger than three months ago, primarily reflecting the increasingly positive tone of recent survey data. However, output was still more likely than not to remain below its pre-crisis peak until next spring."