Unwelcome news for George Osborne: he will tomorrow present his Budget against a backdrop of the highest inflation for 20 years. The RPI index — what the nation called “inflation” until Brown changed the definition — is 5.5 per cent. It hasn’t been this bad since the aftermath of the ERM crisis, an unhappy comparison for the Tories. The CPI index is up to 4.4 per. And those who deploy the usual arguments about global food prices are spiking might wonder: why is Britain now even worse off than Greece?
Even the Zimbabwean media is laughing at us (their inflation is now considerably lower than ours). It’s shocking, but not surprising. As we have long argued here on Coffee House, inflation is out of control in Britain — and Mervyn King doesn’t even seem alarmed about it. In my view, the apparatus used to control monetary policy has proved itself unfit for purpose and I have very little confidence in the situation being resolved by the MPC under its current remit, membership and chairmanship.
Britain’s best politics newsletters
You get two free articles each week when you sign up to The Spectator’s emails.
Already a subscriber? Log in
Comments
Join the debate, free for a month
Be part of the conversation with other Spectator readers by getting your first month free.
UNLOCK ACCESS Try a month freeAlready a subscriber? Log in