I think it's wrong to just focus on the BoE's interest rate decisions when trying to understand the booming UK economy when fiscal policy has hardly been responsible: we've seen a huge increase in government spending in recent years. It's bad enough when you look at government borrowing as it is presented on budget day, but when you consider the £500bn or so of off balance sheet expendicture on top of that, it paints an alarming picture. Brown's tenure as PM maybe a short one as boom does (inevitably) turn to bust.

Oliver Pawley, the sticks, Devon

Brown packed the MPC with doves, so he could get to be Prime Minister before the inevitable pain that results from his massive spending of taxpayers' money on jobs that increase his client voters but add not one jot to the UK's economy.

Don't blame Mervyn King. The pain will have to get a lot worse before we get back to economic reality. As always, "it's the poor wot pays". Still, at least we now have the consolation of hearing how 'umble Mr Brown really is. Pass the sick bowl please.

Tony G, Harrogate, UK

“The Monetary Policy Committee is determined to meet the 2 per cent target and will take whatever further action may be required to do that.” Well he would say that wouldn't he.

Sticking with the cliches, actions speak louder than words, and the MPC's actions over the last two years have been obviously imprudent. While the bank should have been repeating the actions of Eddie George's MPC in 1997, when rates were raised in four consecutive months, they adopted a slow wait and see policy.

It remains to be seen whether the MPC now becomes more aggressive, but I do not share Mr Kaletsky's sudden optimism.

A D Clarke, London,

It must be tough being an economic journalist at this time. You really have to work at it to create a ‘story’. You would seem to have earned your money today.

Henry Percy, London, UK

Why does the image of a poodle always come into my mind when I read Anatole's articles??

Anthony Back, Wellington, Telford, England

You say that the CPI now targeted by the Bank inherently understates inflation because it excludes housing costs and gives more weight than the old retail prices index to expensive durable goods, such as cars and computers, which are falling in price, but which most people buy only rarely. Housing is one point but I had thought that a price index gave appropriate weights to each item. Are you saying that the weight given to cars and computers is wrong or what? If it gives more weight than the older index, is this not because it reflects buying patterns? I am tempted to interpret your argument as a claim that the index is being manipulated. This may be so, but could you give the evidence?

stephen Bull, fontes, France

Get tough? with yet another Mickey Mouse 25 points increase... I don't think so Mr Kaletsky. The interest rate has been FAR too low for FAR too long. Recent hikes are FAR too little FAR too late. A FAR more correct rate is probably in the 8-9% territory which is historically the long term average and still lower than it was 16 years ago when the RPI and M4 was last at current rates. And the economy is stronger today than it was all those years ago.. I'd say our situation is not that different to Iceland's where the rate's well into double digits and still rising.

CWW, Suffolk,

Anatole,
It seems that you have recently been backtracking from your amazing optimism . Are you realising that you were wrong and economic reality is catching up with you and Mr Brown ?

Marc, London,

If you kept all your assets in cash in the last 10 years you would have lost a lot more purchasing power than CPI suggests. Inflation has been running rampant.

Richard, London,

The "success" of the so called independence of the B o E is all Spin. The have missed their( doctored) target 12 consecutive months in a row ! That is only "sucess" by the appalling performance standards of Govt.

R. James, Bristol,

So the whole world economy is going grew at the same time? Very unlikely. A little problem in China must soon arise. Nothing goes up forever and the US Stock market is so far removed from underlying economic reality that soon even our super optimistic American brothers are going to jump ship. About December I reckon. No Anatole. I believe you were right first time.

John Albert, Lisbon, Portugal

Everybody always forgets that there is a long delay between an increase in interest rates and its effect on comsumer confidence. The delay is usually from 5 to 9 months. The Bank knows this, but it is difficult to have enough faith to avoid overcompensating with just one more rate rise.

Frank Upton, Solihull,

A quater of a percentage point - tough? Absolute nonsense what we need is a full percentage point next month and probably a peak to 7%. Brown will surely need to raise more taxes to carry through his socialist schemes- this should all be fun to watch - from afar, but no-one is immune from what is about to occur.

Victor Cowen , Malaga, Spain

"ordinary workers" are they not the same as "most people"?

roger sykes, Christchurch, New Zealand

Clarity on inflation: as no two people on earth have exactly the same basket of goods, no two people can feel inflation in exactly the same way. Correct weighting, therefore, is an endless pursuit. The definition of inflation, however, should be clear: whatever CPI says it is. Why aren't mortgage costs included? because a house is an asset. Better to take into account what is involved in preventing a house's depreciation: building materials and builders' costs. The price of land, which alone explains the rise in house prices (in so far as the actual cost of bricks and mortar is included in the original valuation of the house), is no more a constituent part of inflation than, say, the level of the FTSE or the price of gold.

Pierre Bernardi, Paris, France

Surely the Bank is the proverbial "paper tiger". Collectively, they don't want to raise interest rates and to avoid this, they try to manipulate expectations. You should downplay what they say, AK, and concentrate on what they do. Ultimately they are soft on inflation and the current boom rightly or wrongly will continue to feed on itself.

William Butler, London,

'That Mervyn King, the Governor of the Bank, might be “guiltier of high treason than Guy Fawkes”.- is conceptually wrong. Unless King presides and dominates the MPC meeting as always as what a Czar did, there should be collective responsibility, shared by its members, for every major decision that has been taken. Similarly, I don't balme Tony Blair alone for the mess the country has inherited from 10 years of Labour government.

James Wong, Macau,