It’s chilly in the summer air
It could just be the weather, but it was a decidedly grumpy Bank of England governor who chaired the central bank’s quarterly inflation report yesterday.
Looking thin-lipped and put-upon, Mervyn King gave an impassioned explanation of why it was not his or the Bank’s fault that inflation is high, and rising.
Not since Pontius Pilot broke out the Imperial Leather has there been such a passionate show of “not-myfault-gov”-ing. Nobody, he insisted, could have predicted the rapid escalation in food and commodity prices that has caused inflation to surge.
The world’s central banks have been playing a game of economic pass the parcel recently, each blaming the other for rising costs. Merv the Swerve side stepped questions of whether he could possibly be responsible.
The economy has been hit by a unique combination of shocks, which he called “the biggest financial dislocation since the Second World War.” What could a mere central banker do?
He was terse with questioners. Will he get inflation back to target? “Yes we will”. He kept repeating these words, like he was a banking version of Bob the Builder (“Can we fix it? Yes we can!”) It sounded like he was trying to convince himself as much as the audience.
“It may be summer but there’s a feeling of chill in the economic air,” he said. When he said that the “nice” decade is over, he could have been talking as much about his own manner as the economy.
He promised that we will return to a situation that is “not so bad”. Here’s hoping…