ALEX BRUMMER: Bank of England needs to take the lead and give prosperity a chance

Britain is getting its inflation problem under control. Headline inflation, at 3.4 percent, is falling, core prices (which exclude energy and food) are falling sharply, service sector costs are falling and prices of some food products are falling. costs are decreasing.

All this before the Bank of England’s monetary tightening policy had had sufficient time to take effect.

There could be no better time than today for the Bank of England to get ahead of the curve.

A rate cut from the current 5.25 percent would demonstrate that it is still as pro-growth and jobs-friendly as it was when it lowered borrowing costs at the start of the pandemic.

This would give the UK a head start over the US central bank, the Federal Reserve, which kept its key rate between 5.25 and 5.5 per cent last night.

Lower interest rates would boost consumption, support an anemic housing market, make borrowing cheaper for businesses and help reduce the government’s interest rate bill.

The same groupthink that infected the Bank when it failed to recognize the inflationary danger now exists, in decline.

It would be great to see opinion unite around lowering interest rates.

The fundamental task of the Bank is to achieve the inflation target of 2 percent. Shadow Chancellor Rachel Reeves has given the green light to this aim.

The only change she proposed in her But lecture was the reinstatement of a climate change target in setting tariffs.

His emphasis on the green agenda has two sources. First, she listened to former governor Mark Carney, a zero-carbon fanatic, who endorsed her at last year’s Labor conference.

Second, Labour, having given up on its £28 billion green revolution, must show that it still has what Reeves described as a “green taxonomy”.

Reeves’ speech was intended to convince the city’s grandees that she was a safe person.

As a former member of the Bank of England, it would have been great if she had given us some insight into what needs to change if the Bank is to be a better manager.

This would require greater diversity of thinking within the Monetary Policy Committee, including expertise in industrial work, expertise in financial markets, and more members outside the magic circle of Treasury officials.

As we wait for change, Governor Andrew Bailey and his inner circle need to wake up, smell the coffee and give prosperity a chance.

Dyson Dusting

Chancellor Jeremy Hunt has long argued that “full accounting” of business investment is more important than overall corporation tax rates.

There was never going to be a big meeting of the minds during his talks with Britain’s chief engineer and inventor James Dyson, who criticizes ‘skyrocketing corporate taxes’.

The FT reports disagreements when the two men discussed tax breaks for research and development (R&D) a week ago.

Hunt reportedly suggested that if Dyson really cared, he should become an MP.

Dyson accuses the government of boasting about British science and technology, but scandalously neglecting the sector.

Aims to boost R&D in Britain no longer appear to be a priority. Among global innovation leaders, the United States spends 3.4 percent of its GDP on R&D and Israel 5.6 percent.

Finding ways to do that is the real growing challenge for Reeves if and when she enters Treasury.

toy story

Many have already tried it, but turning around model train maker Hornby, owner of classic children’s brands Corgi and Airfix, has been a thankless task.

Now it’s Mike Ashley’s turn. Having acquired an 8.9 percent stake, he joined the company as a consultant.

It’s not clear that Sports Direct’s philosophy of “stack high and sell low” is the answer.

There is a golden opportunity to bring classic toys into the 21st century through franchise, streaming and gaming platforms.

What is needed is imagination and investment. Anything Mattel can do, Hornby can do better.