More UK double-dip food for thought, this time courtesy of the Bank of England.
The Bank’s lending data for September show net mortgage lending stalling (click to enlarge the chart):
Whilst total net lending to individuals increased by £0.4bn, within this net lending secured on dwellings rose by £0.1bn, which is below forecasts for a rise of £1bn, according to BNY Mellon.
Though JPMorgan’s analysis makes allowances for some volatility, the figures still make for depressing reading (emphasis ours):
Though the flow of approvals held in, the cash value of net lending secured on homes was very weak in the month at just £0.1bn…There has been some month to month volatility in this data over the last 3 months, with August’ s reading looking unusually firm. But even looking through that, the pace of expansion in the stock of mortgage debt has slowed to an absolute crawl.
And from BarCap:
In value terms, the figures were less upbeat as net lending secured on dwellings rose by just £0.1bn in September (BarCap £1.0) and was significantly below the August increase of £1.6bn. Consumer credit on the other hand rose by £ 0.3bn, more than the consensus (and BarCap) forecast of £0.0bn.
Whilst net lending secured on dwellings has been fluctuating, today’s figure is still a fair way short of the previous six-month average — £0.5 billion — and the August figure. Even a steadying in the number of mortgage approvals is no cause for cheer at JPM:
While prior indications had suggested a small decline in mortgage approvals for home purchase, the BoE data showed the count holding steady in the month at 47.5k….Despite the stabilisation in the month, the level of approvals remains very low, and the trend remains modestly downward.
Related links:
Something for Mr Posen and his friends – FT Alphaville
Business cash holdings pick up – FT