Bank of England  

Bank data shows consumer confidence

Bank data shows consumer confidence

The annual growth rate of mortgage borrowing has remained steady, indicating a level of consumer confidence, the Bank of England’s latest data has shown. 

The Money and Credit statistics for February showed individual net borrowing through mortgages had fallen but was only slightly weaker in February at £3.5bn than average £3.8bn recorded for the past six months. 

As an indicator for future lending, mortgage approvals for house purchases also fell slightly to 64,300 approvals, down 1,200 on the six-month average. 

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There were 47,700 approvals for remortgages, also below the 49,500 average of the previous six months. 

Meanwhile the growth rate of credit card lending and other loans fell slightly in February to 6.3 per cent, well below the peak of 10.9 per cent in November 2016. 

Nick Chadbourne, chief executive at LMS, said: "Continued borrowing indicates strong consumer confidence, which provides a good opportunity for brokers and lenders to guide remortgagers through the different options available.

"Over the next few months, it is likely we will see a surge in remortgage activity. April 2019 will have the highest product expiry rate for the past two years and the current low interest rates won’t last forever, so homeowners will be looking to take advantage of these deals while they last.

"We are already seeing customers choosing longer term products when remortgaging and it will be interesting to see if this trend continues throughout the year."

The Bank of England data showed an increase of £5.3bn in the amount of money held by household in February, compared with the £3.3bn average increase of the previous six months. 

It cited "continued strength in instant access interest bearing savings accounts" as the driving factor. 

Elsewhere, UK businesses repaid £3.8bn of financing in February, driven mostly by bond markets where there were net redemptions of £3.1bn. 

Bank lending to large businesses increased in the month by £1.1bn, to £316.5bn, but remained below the recent average increase of £2bn. Small and medium sized business lending fell slightly by £0.1bn, to £165.8bn.