Mortgage Approvals at 18 month low
Today’s figures for mortgage approvals and business borrowing do not show any sign of increased demand. The monthly figures from the British Bankers’ Association show the level of lending by the main high street banks; the mortgage figures show that the value of loans approved (seasonally adjusted) as it its lowest level since May 2009, while the number of loans is at its lowest since March of that year.
This is still well short of the levels we saw during the recession, but the picture is not encouraging. As the Guardian has pointed out, the figure for net lending is the lowest since October 2000.
The BBA’s statistics director, David Dooks, said that the figures for business borrowing “reflect weak demand combined with companies reducing gearing by repaying bank borrowing.” They may well also reflect tough lending criteria; either way, they do not point to the investment-led growth the government hopes for.
If the government is right, and the cuts are going to lead to a private sector-led recovery, these charts will change at some point in the next 18 months. If not, not.