The economy is tanking: Mark Carney should take note

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The messages on the economy from the Office for Budget Responsibility and Bank of England could not be more different.

The OBR says the economy is tanking, and growth will fall for two or three years, and remain lacklustre thereafter. It also says that inflation has now peaked.

The Bank of England, by raising interest rates recently, said that it had to take steps to dampen down a potentially overheating economy.

Only one of these views is right. And rationally, there's not a person of sound mind who will side with Mark Carney and the Bank of England on this one.

UK productivity is dire, and will not improve on the basis of the paltry sums to be spent on training mentioned yesterday, welcome as such pittances are. In that case growth is not going to happen, and any inflation there is arises purely from exchange rate shocks, which cannot be addressed or corrected by Bank of England action. So, to put it another way, interest rate rises should be off the Bank of England agenda for a very long time to come.

Now, is Threadneedle Street listening, because we need to it to be doing so? This is not the time for a supposedly independent Bank of England to be making things worse than they already are.