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The Bank of England has pledged to keep its benchmark interest rate at 0.5% until the unemployment rate in Britain dips to 7% from its current level of 7.7%, a threshold officials believe could take up to three more years to cross.
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Indeed, an emphasis on rates is exactly what we can expect from Federal Reserve Chairman Ben Bernanke's testimony this week. He will reiterate the message of last week, that quantitative easing and interest rates are two separate policies. An end to quantitative easing does not imply that the date of the first rate increase has been moved forward.
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