LONDON (AP) Official figures show that unemployment in the U.K. fell by 24,000 people between May and July to 2.49 million, raising hopes that the recovery in Europe's third-largest economy is gathering speed.
The Office for National Statistics also said Wednesday that the country's unemployment rate declined to 7.7 percent from 7.8 percent.
The unemployment rate is being closely watched by the Bank of England and its new governor, Mark Carney. Last month, the bank issued a so-called forward guidance that it won't consider altering its loose monetary policy including raising its main interest rate from its record low of 0.5 percent until unemployment hit 7 percent.
Bank officials had said it would probably take three years for unemployment to reach that level, but Wednesday's figures suggest that may happen sooner than originally thought. The pound spiked higher following the release as investors priced in the possibility that the bank will raise interest rates early.
RBC Capital Markets senior economist James Ashley warned that the Bank's "forward guidance may prove to be less of an effective anchor than policymakers might have hoped" if the unemployment figures continued their trend in the coming months. However, he added that he thought the pace of further declines months will be modest.
