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UK consumer credit slows sharply in July

Staff Writer |
Lending to both businesses and consumers slowed unexpectedly in July, although mortgage approvals were just a tad weaker than anticipated.

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According to the Bank of England, total lending to individuals increased by 0.2% month-on-month to reach £1,595.5bn.

That was split between a rise of 0.4% on the month or £0.8bn (consensus: £1.6bn) to £213.5bn in consumer credit and of 0.2% or £3.2bn (consensus: £3.9bn) to £1,382bn in lending secured on dwellings.

Bank noted how consumer credit had been volatile "in the recent past", pointing to similar weakness in March.

Within consumer credit, lending via credit cards was especially weaker, advancing by just 0.3% against June after a rise of 0.8% in the month before.

It was a similar story in 'other loans and advances', where the monthly rate of growth slowed from a clip of 0.7% in June to 0.4% for July. In April, they had increased by 1.0%.

Versus a year ago, the rate of growth of consumer credit slipped from the 8.8% clip seen over each of the previous three months to 8.5%, while lending secured on dwellings was unchanged at 3.2%.

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