Tuesday, September 16, 2008

BoE/Treasury Explains the inflation cock up

Chancellors Inflation Open Letter

The Treasury's response to the Bank of England's open letter

Posted by jason @ 11:59 AM (672 views)
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7 thoughts on “BoE/Treasury Explains the inflation cock up

  • Three things really strike me about this reply:

    1. Despite King’s letter raising it quite conspicuously, Darling seems to have completely ignored the fall in the value of the Pound and the effect of that on inflation.

    2. When discussing recent inflation (i.e. that under New Labour) Darling quotes all of the figures in CPI, then compares these with 1970s RPI figures. I guess he couldn’t compare like-with-like as that wouldn’t have made New Labour’s performance look so good.

    3. Darling seems to think that his new housing policies will help the economy.

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  • I guess the 20 billion printed yesterday isn’t exactly going to help the value of the pound either

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  • A Bear In The Woods says:

    There is nothing of substance in this reply at all. Darling just uses it to try and spin the NL record on the economy.

    It is a damning inditment of the state of the state of politics in this country.

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  • Is it just me, or does anyone else think that if the Chancellor needs a letter to explain why inflation is over target then he shouldn’t really be running one of the worlds biggest economies?

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  • Agreed timmy t , why doesnt the chancellor just google it?

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  • Merv’s and the badger’s letters are obviously written for public consumption. They are clearly intended to divert any blame for inflation away from those responsible for controlling it. They are also intended to serve as a warning for those contemplating significant payrises. I wonder if the two guys sat in a room beforehand discussing what to put in their respective letters to get the message across to the thicko population – Bremner Bird & Fortune style.

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  • timmy t – maybe it’s a punishment, maybe Mervyn has to write the letter ten times in his best handwriting.

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