UK lending to individuals and businesses softens in July
By Alexander Bueso
Date: Friday 30 Aug 2019
(Sharecast News) - Lending to UK consumers and businesses slowed further in July, although mortgage lending held up.
According to the Bank of England, consumer credit dipped growth in July to £0.9bn after £1.0bn in June, that was less than the £1.0bn forecast by the consensus and well below the £1.5bn average seen over the preceding two-and-a-half years.
Nevertheless, it was only modestly below the latest 12-month average of £1.0bn.
In year-on-year terms, consumer credit growth cooled to 5.5% versus the peak of 10.9% seen in November 2016.
Meanwhile, mortgage lending bounded ahead of forecasts, rising by £4.6bn (consensus: £3.7bn), its biggest increase since march 2016, but only because of a drop in repayments as opposed to new lending.
Mortgage approvals for home purchase also came in ahead of forecasts at 67,300 (consensus: 66,100), marking their strongest reading since a year ago but remained in the "very narrow range" seen over the preceding two years, Bank said.
But whereas individuals stopped repayments, corporates did the opposite, repaying their lenders for the first time since February, to the tune of £2.5bn, led by a £2.0bn net repayment to banks.
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