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UK mortgage approvals fall to one-year low in June | |
(about 1 hour later) | |
British mortgage approvals fell to their lowest level since May 2015 last month, in which the UK voted to leave the EU, but lending to consumers expanded at the fastest pace for almost 11 years. | |
The Bank of England said lenders approved 64,766 mortgages in June, compared with 66,722 in May, extending a gentle slide since the start of the year and below analysts’ expectations of 65,650. | |
The figures shed little light on how Britain’s economy has reacted to the EU referendum on 23 June. | |
Lending to consumers rose by 10.3% year on year in June, the fastest annual growth since October 2005, but the Bank has said it expects credit growth to ease in the second half of this year. | |
UK consumer confidence suffered its sharpest drop in more than 26 years after the Brexit vote, as Britons became increasingly pessimistic about the UK economic outlook, according to a survey from market researcher GfK. | |
Worsening morale among consumers and businesses will likely spur the Bank into cutting interest rates next week to a record low, according to economists polled by Reuters. | |
Net mortgage lending, which lags approvals, rose by £3.348bn in June, the Bank said, much more than a forecast of £2.6bn in the Reuters poll, but still some way off March’s recent peak of £7.275bn. | |
The Brexit vote had an immediate impact on Britain’s housing market, causing buyer interest and expectations of future sales to wither at the fastest pace in years, according to the Royal Institution of Chartered Surveyors. | The Brexit vote had an immediate impact on Britain’s housing market, causing buyer interest and expectations of future sales to wither at the fastest pace in years, according to the Royal Institution of Chartered Surveyors. |
Mortgage lender Nationwide said this had yet to be reflected in house prices, reporting that prices rose at their quickest annual pace for four months in July. | |
Less comprehensive figures from the British Bankers’ Association showed that the number of mortgages approved by banks fell to a 15-month low in June. | |
The Bank said consumer credit grew by £1.837bn, up from £1.599bn in May. Economists had expected growth of £1.4bn. | |
Lending to non-financial businesses increased by just over £1bn in June, down from £3bn in May, the Bank said. On an annual basis, lending to business rose by 2.7%. |