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UK Mortgage Approvals Highest Since 2007

UK mortgage approvals rose to the highest level since late 2007 as the property market continued to recover from the coronavirus driven downturn, data from the Bank of England revealed Thursday.

The number of mortgage approvals increased unexpectedly to 91,454 from 85,530 in the previous month. Approvals were forecast to drop to 76,110.

This was the highest number of approvals since September 2007, and was 24 percent higher than approvals in February 2020.

Net mortgage borrowing increased to GBP 4.8 billion in September from GBP 3.0 billion in August.

Net consumer credit borrowing weakened in September, with households making net repayments of GBP 0.6 billion. On a yearly basis, consumer credit fell 4.6 percent, a new series low since it began in 1994.

Households borrowed an additional GBP 4.8 billion secured on their homes, following borrowing of GBP 3.0 billion in August.

The increase on the month reflected higher gross borrowing of GBP 20.5 billion, although this remained below the February level of GBP 23.4 billion.

Thomas Pugh, an economist at Capital Economics, said September's money and credit data showed that the mini-boom in the housing market continued, but a fall in consumer credit suggests that consumer spending was already faltering before the latest round of restrictions to curb the spread of the virus were imposed.

The broad money supply M4 grew 0.9 percent on month, taking the annual growth to 12.3 percent in September.

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