Grim but not unexpected news from Mervyn King, the Governor of the Bank of England, in The Telegraph today:
Mervyn King warned families to brace themselves for a further "squeeze" on household finances as rising energy bills and food prices continue to rise.
Mr King said that inflation was set to increase sharply to about 3.7 per cent - almost double the official target. As a result most British people will feel poorer this year as pay rises fail to keep pace with rising costs.
The Governor - who said that "the nice decade is behind us" - also warned homeowners that property prices would fall further and that it was impossible to predict the scale of the decline...The prospects for the British economy have worsened since the Bank's last inflation report in February.
You can read the full article HERE.
The Times, The Guardian and The Daily Mail also cover the story, which will not help Gordon Brown's umpteenth relaunch very much at all. The BBC reports that Gordon Brown is likely be quizzed later on the state of the British economy at his regular press conference.
