With hindsight will this prove to be the day the number crunchers handed the keys of Number 10 to Keir Starmer?
The two sets of economic figures from the Office for National Statistics today were both, in their different ways, pretty dire.
That slender miss on the 2.3% April inflation figure may not sound much, but it will have a huge knock-on effect for millions of homeowners and businesses. It seems almost inconceivable now that three MPC hawks can be converted into doves in time for the June 20 meeting of the Bank’s MPC.
It was 7-2 for a hold last time and that split may not change. Underneath the headline CPI figure all the data points most closely watched by the MPC are all running far too hot for comfort.
The figure for services CPI in particular must be a huge cause for concern after it only dipped from 6% to 5.9%.
Those big pay rises appear to be feeding through to prices, particularly in the hospitality sector. Stealth price rises such as the baked-in RPI-plus increases for the cost of mobile phone and broadband contracts that come into force in April also played their role.
Meanwhile the Government was forced to borrow £20.5 billion in April, more than forecast by the OBR. That is going to make it even harder for Jeremy Hunt to justify another tax giveaway before the country goes to the polls.
The Tories’ ratings had been showing tentative signs of improving after the strong GDP growth seen in March and Britain’s escape from recession.
But if asked, few people would say that have felt that in their day to day living standards. They are still finding the going tough.
A succession of interest rate cuts will always have been inked into Downing Street’s plan for a recovery in popularity in the run up to the election.
With that now effectively taken away, perhaps Rishi Sunak will conclude there is not much to be gained from waiting until the autumn before going to the country. Hold on to your hats for a July date with political destiny.
