UK Mortgage Approvals Rise Unexpectedly
(RTTNews) - UK mortgage approvals rose unexpectedly in March, reaching a four-month high, while consumer credit logged its fastest growth since early 2024, official data showed Friday.
The number of mortgages approved in March rose to 63,531 from 62,708 in the previous month, the Bank of England reported. Approvals were forecast to fall to 60,000.
The 'effective' interest rate, which is the actual interest paid on newly drawn mortgages slowed to 4.03 percent in March from 4.1 percent in February.
This week, the BoE left its key interest rate unchanged at 3.75 percent but cautioned that there is a risk of material second-round effects from the energy price shock, which could lead to future rate hikes. Previously, the BoE had reduced the rate by 25 basis points each in August and November last year.
Mortgage lending increased to GBP 6.2 billion in March from GBP 5.2 billion in February. However, the annual growth rate of lending eased to 3.0 percent from 3.4 percent in February.
Consumer credit dropped slightly to GBP 1.9 billion from GBP 2.0 billion in the previous month. Nonetheless, annual growth in consumer credit rose to 8.9 percent from 8.6 percent in February.
Net borrowing through credit cards remained unchanged at GBP 0.7 billion and net borrowing through other forms of consumer credit dropped to GBP 1.2 billion from GBP 1.3 billion in February.
Loans to businesses increased to GBP 7.0 billion from GBP 4.2 billion in February. Within this total, borrowing by large businesses rose to GBP 5.0 billion from GBP 3.7 billion and small and medium-sized businesses borrowed GBP 2 billion compared to a GBP 0.5 billion in February.
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