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Carney defends forward guidance after policy change

12 February 2014 Last updated at 13:44 GMT

Bank of England governor Mark Carney said the bank's forward guidance policy was working after changing policy so that rates will be determined by a wider range of indicators than just unemployment.

Introducing the policy last August, Mr Carney said that the bank would not consider raising interest rates until unemployment had fallen to 7% or below.

Journalists asked him if the threshold was set at the wrong level, but he said the it had provided "a very clear, clean, simple message to businesses" which had helped reinforce the recovery.

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