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mpc: 14 Total lending to individuals was growing at some 14% on an annual basis. Loan approvals for house purchase had again fallen a little, but new purchasers would continue to underpin borrowing growth, as they replaced existing owners whose housing-related debt had been taken on when house prices were much lower. The income gearing implied by current and prospective indebtedness, if interest rates followed the trajectory implied by market forward rates, would reach levels last seen in the early 1990s within two or three years. A key difference, however, was that this increase could be anticipated, as it was not the result of unexpected policy changes but simply reflected the expected increase in the stock of debt and the interest rate path expected by the market to be consistent with achieving the inflation target. Nevertheless, households might not have taken the prospective increases in interest rates fully into account.