U.K. Consumer Credit Rises in June as Households Lift Spending

While households have been tightening their belts this year as Brexit clouds the outlook, they are still willing to spend.

Jill Ward

29 Jul 2019, 04:29 PM IST

U.K. Consumer Credit Rises in June as Households Lift Spending

Shoppers carry shopping bags decorated with the British Union flag, also known as the Union Jack, as they walk along Regent Street in London, U.K. (Photographer: Simon Dawson/Bloomberg)

(Bloomberg) --

U.K. demand for unsecured debt stabilized last month while mortgage approvals increased, Bank of England figures published Monday show.

While households have been tightening their belts this year as Brexit clouds the outlook, the June figures suggest consumers, the mainstay of economic growth, are still willing to spend. Retail sales unexpectedly surged last month after two months of declines, ONS figures showed.

Key Insights

Mortgage approvals rose to 66,440 from 65,647 in May. Actual mortgage lending rose by 3.7 billion ($4.5 billion) pounds, above the average of the previous six months
Consumer credit rose 5.5% from a year earlier, the weakest pace since March 2014 and down from growth rates above 10% in 2017
Net unsecured lending was 1 billion pounds
Borrowing on credit cards rose by 267 million pounds, other loans were 779 million pounds
Lending to non-financial business rose 2.6 billion pounds, well above the six-month average

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Non-resident investors bought 7.3 billion pounds of U.K. government bonds following purchases of 10.5 billion pounds in May