Sterling is now at a 14-year high. That is bound to weigh with the Bank of England's Monetary Policy Committee, which has to decide whether to lift interest rates today from the current 6 per cent. It's a close call. House prices continue to surge. Retail sales are accelerating, according to fresh data from the Confederation of British Industry yesterday.
Consumer spending needs to be curbed soon if the economy is avoid a dose of inflation.
On the other hand manufacturers are warning that they risk slumping back into recession. With talk of the euro sliding still further, the MPC may have just enough reason to hold off for another month or two. But it will be a knife-edge decision.