Dear Chancellor, inflation is more your fault than mine. Yours, Governor

More interesting than the Governor of the Bank of England’s letter to the Chancellor explaining why inflation has exceeded the official target will be Gordon Brown’s reply. Mervyn King has admitted there is an even chance he will have to write the letter, and a prudent Governor would already be drafting it.

King might want to point out that although inflation is his responsibility — under the pact imposed on the Bank when Labour took office — it is nevertheless Brown who is responsible for some of the steepest price rises. While the private sector valiantly slashes the cost of electrical goods, clothing and food, the government allows council taxes to soar while the so-called regulated prices for services from rail fares to water are permitted to rise at above the rate of inflation, thus pulling up the inflation rate with them.

Of course, there are other pressures on costs, not least energy prices, but King might even push his luck by asking what the prolonged conflict in Iraq has done to keep down prices.