Carney: Investors have got it wrong on interest rates

Mark Carney has moved to defend the Bank of England's 'forward guidance' policies and said further stimulus may be necessary keep the UK economic recovery on course.

Speaking at a business conference in the Midlands, BoE Governor Carney (pictured) sought to clarify the purpose of the forward guidance policies the Bank introduced in its August inflation report. The guidance centred on the Bank's intention to keep rates on hold until unemployment falls from 7.8% to 7%, but many investors' attention focused on the caveats to that forecast. This caused markets to bring forward their UK rate rise expectations in the belief the Bank will be forced to U-turn on its own estimates. But Carney suggested markets' belief rates will now rise in mid-2015, ra...