Business View: Wake up, smell the fear, and ignore the dismal doomsayers

Members of the Monetary Policy Committee of the Bank of England - I know it has been dreadful weather these past few days, but would you please go outside? Walk down the local high street and pop into a few shops. Clothes shops would be good. A couple of electrical outlets. Some department stores. Anything but a supermarket.

Members of the Monetary Policy Committee of the Bank of England - I know it has been dreadful weather these past few days, but would you please go outside? Walk down the local high street and pop into a few shops. Clothes shops would be good. A couple of electrical outlets. Some department stores. Anything but a supermarket.

When you are in there, see if anyone's buying anything. Chat to the shop assistants. Have a word with the manager. If, at the end of this, you still have any urge to raise interest rates when you meet on Wednesday and Thursday, take a cold shower.

As we expound in our analysis on pages six and seven, the high street is a dreadful place to be at the moment. After the worst Christmas for anything up to 25 years, depending on who you ask, the January sales were a damp squib. Any hope of an upturn when retailers restocked in February was soon dissipated. And then the weather turned cold. Having spent part of last weekend trying to buy gloves for a three- year-old, I can tell you that there is any order of T-shirts, shorts and even beachwear on sale, but bugger all to keep you toasty warm in this cold snap.

In the housing market, confusion reigns. Some areas are still going up, albeit much more slowly than a year ago. Some are going down, though not as rapidly as predicted. Most are meandering. Our Money team provide a good guide to the house price confusion on page 24.

As the minutes of February's MPC meeting show, there is a body of opinion that inflation is starting to become a problem. Here I would humbly ask the members of the committee to wake up and smell the coffee - or smell the oil to be more accurate. With black gold well north of $50 a barrel, and energy prices for consumers having risen by anything between 15 and 45 per cent in the past year, it ain't anything the MPC can control that is pushing up inflation.

Every business person, banker and consumer I know wants borrowing costs to stabilise or fall. The only people who think that interest rates should be going up are economists. No wonder they call it the dismal science.

Out of tune with Europe

Meanwhile in Brussels, something is stirring. Angered by the blatant fiddling of their economic statistics by the Greeks to fit in with the Stability and Growth Pact, the European Commission wants to investigate how the stats are drawn up across the EU to ensure all 25 states are singing from the same song sheet.

There are objections. Not from Greece or arch manipulator Italy, as you'd expect, or from the new countries like Poland or the Czech Republic. No, it is France and the UK who think this is a bad idea.

And why might we think that? Well, look back a week ago, when the Chancellor was able to reclassify road maintenance in his spending figures to help him stay within his so-called "golden rule".

New headache for Glaxo

How serious is the US Food and Drug Administration's investigation into Glaxo SmithKline? On Friday, FDA officials - in conjunction with the Department of Justice - seized batches of two of Glaxo's drugs and accused the group of ignoring manufacturing standards at two of its factories. This could go one of two ways for Glaxo.

It could be a minor infringement - there is apparently no health risk - and the US regulators could be acting typically heavy-handedly. The FDA, under fire over Cox-2 inhibitors, may be in "raid first, ask questions later" mode. If so, this little difficulty should blow over in a few weeks.

However, it could be a major problem. In June 2003, the FDA closed the flu vaccine factory owned by US group Chiron in Liverpool, and it has not long been reopened. This has led to a shortage of vaccine at a time when the world fears a bird flu pandemic. A few years ago Fisons was similarly hit, leading to the UK drug maker losingits independence.

Being a global company, closing two factories would not be fatal for Glaxo. But coming after last year's attack on the company over allegedly withholding clinical data on an anti-depressant, and its dispute with the US tax authorities, it seems Glaxo is getting in trouble too often for comfort.

j.nisse@independent.co.uk