UK mortgage approvals and consumer lending growth slip

Consumer lending growth and new mortgage approvals in the UK slipped in February, according to data from the Bank of England.

Around 68,300 loans for house purchase were approved in the month, compared to just over 69,000 the previous month. The number was lower than the 69,100 predicted by economists and marked the first decline since the summer, but was still above the average over the preceding six months.

Howard Archer, chief UK and European economist at IHS Markit, said the slowdown “suggests that housing market activity may now be starting to be affected by the increasing squeeze on consumers and their concerns over the outlook”.

Unsecured lending since the start of the year was stronger than previously thought, however. Net consumer lending in February increased by £1.4bn, ahead of forecasts of a £1.3bn rise. The figure marked a decline compared to the previous month, but only because January’s figures were revised upward from earlier estimates.

Growing credit card debt drove the increase, with the year on year growth rate in credit cards jumping to 9.3 per cent, offsetting a slight decline in other loans and advances.