The wrong type of inflation

It’s an upside down world and the markets are getting confused. An unexpected rise in UK inflation to 3.2% in February was taken today as a good sign. The pound rose to a six-week high against the US dollar – even if $1.47 would have looked unthinkably low a year ago. Inflation is now considered good because deflation is worse. But rather like the wrong type of snow that once stopped British Rail’s snow-proof trains, this is the wrong type of inflation. The Bank of England is using unconvention...