Old Lady is dazed and confused

The joke going around the City yesterday was that Mervyn King voted against cutting interest rates this month because, as a diehard Aston Villa fan, he feels comfortable being on the losing side.

Given that it was the first time the governor has been on the losing side since Gordon Brown granted the Bank operational independence (and that Villa drew their first game of the season last Saturday), it was perhaps an unfair jape. Even so, Threadneedle Street was making it clear that the governor was relaxed about being in a minority on the monetary policy committee this month.

The meeting had been a polite affair, with the rest of the MPC well aware of the governor's viewpoint before the vote was taken. Rather than being seen as a cause for concern, the fact that Mr King could be outgunned by the four outside MPC members - with the help of the Bank's chief economist, Charles Bean - showed just how robust the system was.

All absolutely true. It would be far more worrying if the MPC slavishly followed Mr King's lead at meeting after meeting like the politburo under Stalin. What's equally clear, however, is that the MPC is struggling to know what to do with an economy simultaneously showing signs of weak growth and rising inflation.

The unanimity that marked meetings in 2004 has dissipated in 2005 as the MPC has split into two camps: one that sees six consecutive increases in unemployment as evidence of the need to loosen policy; and one that is worried about stoking up inflation.

In that context, this month's quarter-point reduction looks like the fine-tuning, which was supposed to be a thing of the past - one that makes little difference to the real economy but sends out the message to the public that the Bank is confused and operating pretty much in the dark.

Cheap shots

Rarely have hairs been split so enthusiastically as by Asda and Tesco in their bust-up over which is Britain's cheapest major supermarket.

To appreciate the working hours that went into this dispute, read between the lines of the Advertising Standards Authority's ruling on Asda's ads (www.asa.org.uk). One feels for the officials presented with Tesco's analysis of the make-up of 4.5m baskets of shopping. Pass the headache pills.

On the pure point at issue - whether the ads were misleading - the ASA was clearly right to uphold Tesco's complaint. Asda was silly to claim to be "officially" the cheapest on the basis of a trade magazine survey that covered only 33 items. That's pushing the word "official" well beyond its normal usage.

It's a shame, though, that a verdict of "a plague on both your houses" was not available to the ASA. Such is the range of items within modern supermarkets, and the variety in quality, that sweeping, catch-all price claims are increasingly pointless.

A modern supermarket stocks 40,000 lines; if you buy 50 in a week you're a heavy shopper. You're probably also capable of forming your own judgment of the relative prices for the stuff you buy. Besides, everybody should know by now that local markets are usually a better bet for fruit & veg. The prices are generally at least as good and they don't cold-chill the products to the point of blandness.

If these supermarket statisticians now need something useful to do, how about providing figures for the distances travelled by the products on their shelves?

The concept of food miles is now accepted by government as useful in assessing environmental impact. How about letting shoppers in on the details?

Coining it

It's a sad day for Prince Charles. The Mint has seen enough of the Prince of Wales's fancy feathers featured on the back of the 2p piece. The new looks won't be unveiled until 2008 and, even if the new coins only last half as long as the old ones, it won't be until 2025 that anyone gets the itch to change again. Long live the Queen indeed.

We'll pass over the implied blow here for euro fanatics, the big issue is whether it's time to sack 2p coins once and for all. They're big, they're bulky and they're not even bronze these days. With 6.2bn of these nuisances in circulation, that's more than a hundred 2p coins for every British citizen.

What is everybody doing with them, especially as retailers persist in ending their prices with figures of 49p and 99p? Perhaps we could melt them all down and sell the metal to China.

In a rational world, the 2p would go the way of the half pence and disappear into the world of collectors. The Treasury thinks otherwise - for now.

Hands off

Guy Hands is possibly the brainiest person in the City, but he looks to be on delicate ground in trying to pull out of his takeover of East Surrey Holdings.

The £453m deal was agreed as long ago as April and the Northern Irish regulator raised related concerns in June. Why didn't Mr Hands withdraw at that time?

Perhaps he has seen something within the Takeover Panel's code that gives him room to wriggle. But if he's wrong, his reputation as a quick, clean executer of deals will suffer.