Expectations had been for a very gloomy set of official retail sales figures but, in the event, the official numbers showed a drop of only 0.1%. Food sales were up by by 1%, non-food sales down by 1.1%, In the latest three months overall sales were flat, but up by 2.2% on a year earlier. Details here. The public borrowing figures, as expected, were poor. They are here.

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The most dovish set of minutes in the monetary policy committee's history. Not only did the MPC vote 9-0 for this month's cut in Bank rate from 4.5% to 3% but it also contemplated a bigger reduction of more than two percentage points. Further rate cuts are on the way, as the minutes clearly signal. They are available here.

The drop in consumer price inflation was bigger than analysts had expected, with the headline rate falling from 5.2% to 4.5% and even the "core" rate, excluding food, drink, tobacco and energy, dropping from 2.2% to 1.9%. Mervyn King has some more open letters to write, but probably not that many, at least not until inflation drops below 1%. RPI inflation fell from 5% to 4.2% and may be heading into negative territory. More details here.

These are difficult days for the Bank of England. An institution that sets itself high standards and prides itself on its dignity and decorum is getting a battering.

Gordon Brown is making political hay out of the crisis but he is not carrying the Bank with him. For years central-bank independence was his proudest achievement as chancellor. Now I get people asking whether it was such a good idea after all.

At the stormiest press conference since independence, Bank governor Mervyn King and his colleagues were last week accused of being caught with their pants down as the financial crisis turned into an economic crisis. That is not an image I want to dwell on, or can imagine being put to Eddie George, King's predecessor, but the point was clear.

The Bank has lurched spectacularly in the space of three months in terms of its view on the economy and on interest rates. On the face of it, it was not just behind the curve but out of sight.

What is the Bank's defence? The world, said King, has changed, the outlook has been transformed. After Lehman Brothers was allowed to fail in September by the American government, the global banking system came perilously close to collapse.

Figures from Eurostat showed that eurozone gross domestic product declined by 0.2% in the third quarter, following a similar drop in the second, confirming that the single currency area is in recession. Most countries have not yet released their third quarter data but Italy, down 0.5% after a fall of 0.4% in the second quarter, and Germany, also down 0.4% and 0.5%, have. France grew by 0.1% in the third quarter and has so far escaped technical recession. More details here.

The Bank of England attracted some well-aimed criticism this morning for its inflation report predictions, which now rank among the gloomiest among economists, having been among the most optimistic. The Bank has had what appears to be the opposite of a Damascene conversion over the past three months to the seriousness of the credit crisis, and now thinks the economy is heading for a big recession, albeit a short, sharp one, and that the inflation problem will be one of undershooting - even deflation - not overshooting. A fascinating inflation report, available here, where you can also watch the webcast of the press conference.

Also today, unemployment figures showed a 36,500 rise in the claimant count last month and a 140,000 rise in the Labour Force Survey measure of unemployment over the July-September period. Bad, though not quite as bad as feared. Details here.

Producer price figures confirmed that a sharp fall in inflation is in the pipeline, with "core" output price inflation dropping below 5% and industry's input price inflation dropping from 24% to 13.8% in a month. More details here. Of more significance, ahead of the weekend G20 meeting in Washington, is that China has announced a fiscal stimulus worth around $570 billion. Huge. Here is the Xinhua news agency report

In recent years, when talking to younger audiences, I used to express mock wonderment that we had all become so obsessed with small changes in interest rates. This was when quarter-point changes were the norm for the Bank of England's monetary policy committee (MPC).

A quarter-point change, I suggested, would have been for wimps in the old days, when there was a lot more red meat in the policy diet. "Up by two points, down by one" was not what always happened but it was by no means unusual.

There were good reasons why there was a shift to much smaller rate changes. The general level of rates came down compared with the 1970s and 1980s, when the Bank rate was often in the mid-teens. The economy was sensitive, it seemed, to even small rate moves. The MPC's approach was incremental; monthly meetings meant small changes would cumulatively turn into larger ones quite quickly.

So where did Thursday's wimp-busting 1.5-point shocker come from? First, as I have been arguing for some time, rate cuts lost their potency because the normal transmission mechanism from Threadneedle Street to Main Street is not working. The Bank has to cut more aggressively now to get the same effect as it did two years ago.

Second, the Bank had some serious catching up to do. To wait from April until last month before cutting rates even as the economy was deteriorating fast was the equivalent of being asleep at the wheel.