WHO would be a central banker? The salary isn’t great by City slicker standards; the pension is pretty good, though probably not good enough to compensate for the ordure rained down on you while in office.

So Ben Bernanke, Mervyn King’s old office neighbour when they were both academics, has been attacked for panicking in response to the global stock-market sell-off and for allowing Wall Street to dictate the Federal Reserve’s monetary policy.

People have different views on this – I happen to think the action was right, following the Fed chairman’s gloomier assessment of America’s economic prospects even before Blackish Monday. But the execution of the three-quarter-point cut, the biggest since 1982, was clumsy.

Here, King has finally got what he did not wish for but has long predicted. After five years of independence he warned that the challenges for the Bank were likely to get much tougher. After 10 years, and his first open letter to the chancellor explaining why inflation had gone too much above target, he repeated that warning. He was more right the second time.

What are we to make of the governor’s admission last week that the Bank has “little control over the strength of the economic winds buffeting our economy” and that those winds are likely to continue blowing through 2008?

Does the fact that King is open to the possibility that he may have to write another letter to the chancellor mean that interest-rate cuts are off the agenda? After all, the monetary policy committee (MPC) voted 8-1 this month to leave Bank rate on hold at 5.5%.

The answer, I think, is no. When, in April last year, that first open letter was written, the Bank was widely attacked for falling down on the job. There is no doubt that this was a scarring experience that contributed to a mood of hawkishness on the MPC.

So the Bank is getting its excuses in first, recognising that there are upward pressures on inflation but attributing them to global developments. These are precisely the circumstances where, according to its independence remit, it can allow inflation to run above target for a period.

The remit says: “The framework takes into account the fact that any economy at some point can suffer from external events or temporary difficulties, often beyond its control. The framework is based on the recognition that the actual inflation rate will on occasions depart from its target.”

Trying to keep inflation at 2% now would squeeze the economy too hard at a time when, according to King, a 5.5% Bank rate is already “probably bearing down on demand”.

So there will be rate cuts, and they will be the right thing to do. They should start with a quarter-point early next month.

Slower global growth, and slower growth in Britain, will mean the rise in inflation is temporary. How low should UK rates go? My start-of-year prediction was 4.75% this year and I am inclined to stick to that.

The hardest thing for the Bank is not whether it should cut rates, but how to justify doing so to people not familiar with the remit or with the forces of slowdown and temporary inflation it is trying to balance.

But though it will be hard it is not as difficult as it looks. Most people know instinctively that most retailers are cutting prices and that petrol-price rises reflect international developments. The end of house-price inflation also makes life easier.

So the situation is challenging but manageable. And if King is right that at the end of it we will have an economy with higher savings and less dependency on the consumer, nobody – perhaps apart from the retailers – will complain too much.

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive