–Adds Detail To Version Transmitted At 0930 GMT
London (MNI) – Net consumer credit hit a record low in December and
overseas holding of Gilts plunged, while mortgage approvals picked up,
according to Bank of England data.
The BOE figures showed net consumer credit fell by Stg377 million,
the largest monthly fall on record. Broad money supply data also showed
record monthly falls, hit by a sharp fall in deposits from securities
dealers.
The data showed increased activity in the mortgage market, offset
by low demand for unsecured credit and falling money supply.
December mortgage approvals rose to 52,939 from 52,628 in November,
the highest outturn since December 2009. This was below analysts’ median
forecast for a 54,000 outturn. Net mortgage lending rose Stg0.74 billion
on the month.
The broad money data showed M4 ex-IOFCs, a measure designed to
exclude economically irrelevant intra-financial sector transactions,
fell by a record 0.7% on the month in December, while M4 fell by a
record monthly 1.4%.
The money supply data were impacted, however, by the steep drop in
deposits from securities dealers, which fell Stg16.8 billion in
December, a BOE official noted. This could be reversed in January, with
these deposits having also fallen heavily last December.
On a four quarter/12 month basis M4 ex-IOFCs was up 1.4%, while M4
was down 2.5% on the year and M4 lending down 3.1%.
The BOE December Bankstats data showed net overseas Gilt holdings
fell by Stg10.663 billion, having risen by Stg16.343 billion in
November. Overseas Gilt holdings had surged prior to the start of the
second wave of quantitative easing, which began in October and continued
to rise sharply through the first two months of QE2.
In September, non-resident net purchases of gilts were up Stg9.178
billion, and up Stg12.527 billion in October, before posting the
Stg16.343 billion net rise in November.
–London newsroom: +44 207 862 7491 e-mail: drobinson@marketnews.com
[TOPICS: M$B$$$,M$$BE$,MABDS$]