Blogging from the Highlands of Scotland until I return to the Murcia region of Spain in the Autumn for a month or so
'From fanaticism to barbarism is only one step' - Diderot

Wednesday, 10 December 2003

Chancellor Brown announces increased budget deficit

.... but says increased borrowing is 'sound' and everything remains rosy. Well, that's alright then.

Also announced today is a change in the way inflation is to be calculated, basically to exclude the effect of property price rises from the basket used - we were on RPI, briefly on HCIP, now we're on CPI (Consumer Price Index). Not uncoincidentally, this will allow inflation to be shown as 1.4%, rather than its current 2.6%. The inflation target will be changed from 2.5% to 2.0% to reflect this change. I don't quarrel with the underlying change, but wonder if it is not just too politically convenient with an election probably only 18 months away.

Update: here's the FT take on Brown's budget speech.

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