Mr. John McCarthy:

House prices are now rising and households are also now accumulating financial assets such as stocks and shares and so forth and reducing their financial liabilities. One's assets minus one's liabilities is one's net wealth. The net wealth of the household sector is one third higher than its low point. Again, this inspires confidence. Balance sheet repair is progressing. There are pockets of very high leverage, and there are problems in that regard, but in aggregate terms household net wealth is improving. Another measure we would tend to look at is the leverage ratio - in other words, debt to disposable income. That has fallen for approximately 14 consecutive quarters. Households are making progress in repairing their balance sheets and with that, and the recovery in the labour market, they are now more confident and are consuming. There are tail winds on the domestic front as well.