Mark Carney: Bank of England will act to stop housing market growing at 'warp speed' However, Mr Carney also underscored the importance of low interest rates to allow households and businesses to reduce their borrowing costs, stimulating demand. Short-term interest rates are much more important in the UK than they are here [in America]. 70pc of borrowing for mortgages and 50pc of business borrowing," Mr Carney told the Economic Club of New York. Although he left the door open for the Bank of England to increase interest rates "soon," he said it would be a mistake "to rush to a more extreme response" when the UK economy remains patchy. Britain's economy has regained considerable strength in recent months, and is the fastest growing of any advanced economy, Mr Carney said, but fears persist over the high level of household debt, high unemployment and signs of a fresh housing bubble. "Despite admirable progress by British households in recent years, aggregate debt levels remain high at 140pc of incomes," he said. In addition, housing activity is picking up and price growth appears to be gaining momentum...these developments merit vigilance but not panic. The Ghost of Christmas Past should not be forgotten. He also expressed concerns that Britain's trade deficit is at a "record high," leaving the health of the UK economy heavily exposed to the recovery of the global economy, and adding ballast to the argument for continuing monetary stimulus. My Carney laid out the arguments for continued low interest rates and dismissed concerns that the UK could be heading for a "liquidity trap" - where low interest rates no longer have the power to stoke consumer demand and business confidence. "To prevent the liquidity trap from becoming a coffin, central banks have set monetary policy at emergency levels by reducing short-term interest rates to their lowest feasible levels," he said.