trend ( a ) pre - crisis trend is projected using quarterly growth rates between 1999 and 2007. chart 5 : uk current account ( a ) includes compensation of employees. bis central bankers ’ speeches chart 6 : sterling eri index : january 2005 = 100 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 chart 7 : survey indicators of capacity utilisation ( a ) sources : bank of england, bcc, cbi, cbi / pwc, ons and bank calculations. ( a ) measures are produced by weighting together surveys from the bank ’ s agents ( manufacturing and services ), the bcc ( non - services and services ) and the cbi ( manufacturing, financial services, business / consumer services and distributive trades ) using nominal shares in value added. the surveys are adjusted to have a mean of zero and a variance of one over 1999 q1 to 2007 q3. the bcc data are non seasonally adjusted. bis central bankers ’ speeches chart 8 : cpi inflation projection chart 9 : gdp growth projection bis central bankers ’ speeches

, though, been associated with a reduction in the fraction of income that is saved. this rose sharply in the aftermath of the collapse of lehman brothers as households responded to the increased uncertainty about income and job prospects by building up extra savings, or reducing their debts, as a precaution. as that uncertainty dissipated and households began to feel more confident about the outlook, so the saving rate fell back ( chart 1 ). there is probably some scope for it to fall a little further, but continued firm consumption growth really depends on us seeing a pickup in household income growth, of which i will say more shortly. there is more scope for housing investment to continue driving growth. housing starts and the level of housing transactions are still respectively around 25 % and 10 % below their averages during the pre - crisis decade ( chart 2 ). but the supply of new housing is not as elastic as one would like, because of planning restrictions and the like. consequently there is a risk that increased demand for housing ends up mainly in higher house prices rather than more houses. in turn, if associated with excessive expansion in mortgage lending, that may create future financial stability risks. for that reason, the bank ’ s financial policy committee, which is charged with maintaining the overall stability of the financial system, is keeping a beady eye on the housing market. bis central bankers ’ speeches for the recovery to be both sustained and sustainable, however, we really want to see three things happen. first, business investment needs to pick up the baton in supporting demand growth. second, we need to see a revival in productivity growth, which in turn would sustain both higher real wages and higher profits, thus supporting continued household and business spending growth. finally, though perhaps over a longer time frame, an expansion in net exports is desirable, in order to rebalance the composition of demand and reduce the uk current account deficit. let me say a little about each of these in turn. business investment fell by almost a third in the recession, reflecting the generalised collapse in demand, heightened uncertainty and restricted availability of credit. although those headwinds have eased considerably, business investment in 2013 was still only just over 1 % above its 2010 level. now it is not too surprising that business investment has been slow to pick up. that is typically the case in business cycle recoveries, as businesses will want to use up spare capacity and to be confident that improved business conditions will persist before they undertake capital expenditures that may be costly to reverse. and the