For most of that period the expansion in credit was driven by households (Graph 2). Financial deregulation and innovation greatly increased the supply of credit, and the fall in interest rates as inflation declined in the early 1990s gave households greater capacity to borrow.
Long-term trends Having given that caution, it is worth recounting just a few of the trends we can observe over the past decade or longer. The increased borrowing of the household sector was one such notable trend. It had already been under way for nearly a decade by 2000, but kept going for the best part of another decade after then.