- Prior 0.67bn
- Mortgage lending 1.988bn vs 1.60bn exp. Prior 1.72bn
- Mortgage approvals 61,707 vs 61,600 exp. Prior 62,918
- M4 money supply -0.1% vs -0.1% exp m/m. Prior -0.2%
- -0.9% vs -0.3% exp y/y. Prior -0.6%
- Ex intermediates 3mth annualised 2.7% vs 3.1% exp. Prior 4.5%
The drop in mortgages confirmed as some fallout from the rule changes in April but lending amounts saw its biggest increase since July 2008.
As we saw in the GDP revisions last week business investment was very strong and we see the lending figures today. Lending to non-financials rose to 3.41bn from -2.36bn in April and to the highest since the data started in May 2011. Lending to individuals (inc mort 7 consumer) rose to 2.278bn from 2.401bn last month.
While we knew about the good news regarding businesses we need to watch the consumer numbers as the BOE will not want to see consumer credit running away like it was before the crisis. Carney spoke about the risks from household indebtedness last week and this will also be something that will be hit by interest rate rises.
As you can see from the chart below we’re still a fair way off pre-crisis levels
UK consumer credit y/y 30 06 2014
As for mortgages, the new BOE rules announced will have come too late to affect the June figures so it will be August before we see July’s numbers and whether people have rushed to get in before the changes that come into effect in October.
