Governor’s 20 year flashback doesn’t add up

WHILST another governor may have used yesterday’s Inflation Report press conference to look forward, Sir Mervyn King took a more nostalgic approach in his opening remarks.

The Bank of England governor reminded us that this was the 20th birthday edition of the Report. Back in 1993, King was serving in the more lowly position of chief economist and executive director at the Bank of England.

King’s anniversary comparisons made yesterday don’t all bear scrutiny. The Capitalist wonders if King isn’t being too optimistic when he compares the economic situation now with 1993. In April 1993 the government declared the official end of the recession after growth reached 0.6 per cent. But with the latest figures at –0.3 per cent, there hardly seems to be the same hope that it will all end up quite so rosily.

There are similarities though – in 1993 we had a Conservative PM in John Major. And a Royal scandal – Princess Diana sued the Daily Mirror over photographs that were taken of her at a gym whereas now the focus is over photographs of the pregnant Duchess of Cambridge in an Italian magazine.

At least some things don’t change.