Parting shot
DEAR Mervyn (writes John Vickers, the Bank of England's chief economist), here's what you might like to say this week when You present the Inflation Report: We have been amazingly lucky in the European Cen- tral Bank, which, when it comes to managing a currency, has everything to learn. What the papers call the strong pound is really the weak euro, and it's saved our bacon. It has held inflation down when private demand in out own dear economy has gone barrelling away, growing by 5 per cent year after year. How long we can keep this act going I don't know. This time round, we've chosen to assume that people will tone down their Spending, even though the banks are throw- ing money at them. We've chosen to assume that that plumbers won't charge more, even though the labour market is as tight as a drum and you can't get a plumber for weeks. We also assume that all the money Gordon Brown is spending won't be spent just yet. I'm leaving anyhow, so I could say all this. How about you? Dear John (writes Mervyn King, Deputy Governor), can it. This time, I plan to be boring.
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