Only that can improve export competitiveness and underpin consistent increases, rather than falls, in real wages. To generate needed productivity growth will require recent strong business investment growth –10% over the past year – to be sustained. The MPC is supporting investment through clear guidance that it expects increases in Bank Rate, once they begin, to be gradual and limited. From my own experience visiting businesses up and down the country, including some in Glasgow earlier today, I know that businesses understand this message. This guidance puts all the short-term noise about when the first rate rise will be into its proper context and it encourages firms to hire and invest with an eye to the medium term. Why does the MPC expect Bank Rate increases, once they begin, to be gradual and limited? This is in part because the headwinds facing the economy are likely to take some time to die down. These headwinds include public balance sheet repair, a highly indebted private sector likely to be particularly sensitive to interest rates, as well as the drag from a 12% appreciation of sterling over the past year and the persistent muted demand from our main export markets. Over the medium term, several dynamics are likely to keep rates lower than in the past. UK rates could be restrained by continued imbalances between global saving and investment, together with potentially lower rates of global productivity growth.
In short, to be effective, markets must also be fair. And we need to invest in social capital just as we invest in economic capital. That is why the Bank, Treasury and Financial Conduct Authority are undertaking a major review to secure true markets. Markets:  3  4  Adam Smith (1789), The Theory of Moral Sentiments. BIS central bankers’ speeches  •  that are open and transparent;  •  where access extends beyond a privileged few;  •  where all who wish to trade have common information and commonly accessible prices; and  •  where the informational integrity of key benchmarks is beyond question. Some of this will require changes to the way markets work. Some can be delivered by bringing more activities within the scope of regulation. And some may require new codes of conduct. We need a simple approach that recognises that the actions of a few to manipulate, game or profit from unfair access weakens the effectiveness of markets for all. Such actions hold back prosperity. They should therefore have clear consequences. Our approach should deliver true markets which are the greatest source of dynamism, prosperity and progress. Completing this agenda will reinforce the G20’s efforts to rebuild an open and resilient financial system, and in doing so it will support underpin global trade and investment to the benefit of all. Conclusion The UK, the Commonwealth and the world have always drawn inspiration from great Scots.