The UK’s economic situation is improving according to the Bank of England, with unemployment dropping and output increasing at better rates than predicted.
The news was revealed in the minutes produced at the October meeting of the Monetary Policy Committee. The minutes showed that the August forecasts were a little conservative and also stated that the committee voted to keep the current low interest rate of 0.5%.
It has also been confirmed that both consumer and business confidence have been growing and that many industries are seeing an upturn. All types of work including contracting and full-time employment, are increasing. The rate of unemployment is 7.7% at the moment, down from 7.8% in August. In August the bank thought that it would take up to three years for the rate of unemployment to fall to 7%; it is at this point that it will consider raising interest rates again.
There appears to be some division of opinion about the speed at which productivity will rise and how quickly unemployment rates will fall.
There has been a strengthening of sterling, which will help to keep inflation down. The aim is to get inflation down to 2%, but it has been higher than this since the end of 2009. The current rate of inflation is 2.7%.