BOE raises growth forecasts, changes forward guidance.

The Bank of England has increased its outlook for the U.K. economy, predicting that 2014 GDP will grow 3.4% vs a previous forecast of 2.8%. However, Governor Mark Carney indicated that the recovery is neither balanced nor sustainable, and with spare capacity high and inflation benign, the degree of stimulus will need to remain "exceptional" for some time. The BOE had said it would keep interest rates low until unemployment falls to at least 7%.