Buckle up for a bumpy landing with BoE’s pilots
Think of the Bank of England’s Monetary Policy Committee (MPC) - collectively - as the pilots of the British economy jumbo as they prepare to meet for the latest interest rate call on Thursday.
The plane definitely feels like it is descending and may even be close to stalling speed. Yet half the indicators on the dashboard - including this morning’s once again remarkably strong jobs figures - suggest it is still gaining height. The property market is going like a train - to horribly mix transport metaphors - and inflation is about to bust double figures.
So where does this leave the MPC struggling with the controls in the cockpit?
As with any aircraft captain the number one priority is avoiding unplanned contact with the ground. That always ruins your day.
But equally we all know what happens to a plane that keeps ascending at a steeper and steeper angle - eventually it runs out of lift. Often with catastrophic results.
When this is all over they are going to have to rewrite the “flying the economy” manual. By any historical standards Britain is at full employment - yet recession looms later this year.
So what to do to ensure a soft landing - hopefully on a runway? It is a tough choice. Between a quarter point rise that may do little in the short term to slow the inflationary climb? Or take a chance with half a point and risk triggering the recessionary plunge.
It is not an easy call.
Meanwhile the passengers are buckling up and hoping the folks at the pointy end know what on earth they are doing.