King quiet until election

BANK of England governor Mervyn King will hold off criticising the government in the run-up to the general election, it was reported yesterday.

The former LSE professor is expected to maintain a ceasefire until polling day amid concerns his opposition to Treasury policies has handed political ammunition to the Conservative party.

King first caused controversy a year ago when he called on chancellor Alistair Darling to restrain spending. Last week, his comments were used by Tory leader David Cameron to attack Prime Minister Gordon Brown’s deficit reduction plan during Prime Minister’s Questions.

While there is no formal agreement between Threadneedle Street and Number 10, King is said to be aware of the growing sensitivity of his position. One analyst said it would be unwise for the bank to allow itself to become a political football.