LONDON: British unemployment has hit a four-year low, official data showed on Wednesday, but the Bank of England hinted that record-low interest rates would remain on hold for some time.

The unemployment rate slid to 7.4 per cent in the three months to October from 7.6pc in the quarter ending in September, the Office for National Statistics (ONS) said. Market expectations had been for no change.

The Bank of England, under Governor Mark Carney, has stated that it will not raise borrowing costs from a record-low 0.50pc at least until the unemployment rate falls to 7pc, under a “forward guidance” policy.

The rate now stands at the lowest level since the three months to April 2009 and has therefore sparked speculation that the BoE could raise its key lending rate sooner than anticipated.

However on Wednesday, minutes from the BoE’s rate-setting monetary policy committee (MPC) also forecast that annual inflation was set to fall under its 2.0pc target in mid-2014, meaning any rate rise could be delayed.

The BoE’s main task is to keep annual inflation rate close to this government-set target level.

“While the latest labour market figures have raised the chances that the jobless rate falls below the MPC’s 7.0pc threshold in 2014, December’s minutes suggested that the benign inflation outlook will enable it to keep rates on hold for a long time yet,” said Capital Economics analyst Samuel Tombs.—AFP