British mortgage approvals for house purchases rose faster than expected in September to their highest in 18 months, but consumers continued to cut back on unsecured borrowing for a third consecutive month.
The Bank of England will decide whether to extend its quantitative easing policy next week, and alongside the mixed lending data it will have to consider weak growth in M4 money supply, which QE had been expected to help.
Headline M4 grew 0.8 per cent in September for an 11.6 per cent annual rise. But the central bank's preferred measure, which excludes some non-bank financial intermediaries such as clearing houses, fell 0.9 per cent on the month and shrank at an annualised rate of 1.7 per cent in the third quarter.
The mixed signals provided little steer to British government bond or foreign exchange markets.
Mortgage approvals numbered 56,215 in September, up from 52,970 in August and above economists' expectations of a rise to 54,000.
But total consumer credit remained subdued as consumers repaid debt for a third consecutive month, although the repayment of £262 million in September was slightly less than the £373 million repaid in August.
Consumers borrowed a net £79 million on their credit cards in September, the lowest amount since last December.
Reuters