Bank of England Governor Sir Edward George says he is optimistic the economy could be in for a period of more balanced growth than it has seen in recent years.
The British economy has been heavily dependent on consumer spending in recent years as the high pound took its toll on exporters, causing the Bank to cut interest rates to a 48-year low of 3.75 per cent.
Sir George, who retires at the end of this month after 10 years in the job, said: "Most of the problems we have experienced over the last three to four years have had their origin overseas . . . and we have been confronted with the need to try to offset those pressures - you can never be immune from them".
Sir George repeated that consumer spending and the house price boom were "beginning to moderate", that the international situation was improving and that the pound was weaker against other currencies which should help exports.
Sir George repeated his view that although house prices had fallen in some areas, such as the top of the London market, elsewhere there was only a "moderation in the rate of increase".