MADRID – The British pound surged on Wednesday after a sharp fall in unemployment firmed up the picture further of a recovering economy. Unemployment in the U.K. fell to 7.1% in the three months to November, from 7.4% in the three months to October. Analysts had expected a rate of 7.3%. The pound jumped to $1.6541 from a level of $1.6473 seen earlier in Europe. "The issue for the Bank of England is that its forward guidance policy is now outdated after just five months," said Dennis de Jong, managing director at UFXMarkets, in a note. "(BOE Governor) Mark Carney and co. must decide if they cut the unemployment threshold to 6.5% or 6%, or base future interest rate decisions on wage growth rather than solely unemployment."
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