**MNI 5 THINGS: UK Mortgage Approvals Hit Six-Month High

By Jamie Satchithanantham and David Robinson

     **LONDON (MNI) - The following are the key points from the January money

and credit data release published Thursday by the Bank of England:

     - The data revealed mortgage approvals were up in January for only the

second time in the past six months, rising to a six-month high of 67,478. This,

however, follows December's near-three-year low of 61,692 and so some bounce

back was probably always inevitable. The bigger picture, as indicated by other

soft data surveys, remains one of a market lacking momentum.

     - In the MPC's key judgements in the Feb Inflation Report the Bank stated

that between Q1 and Q3 2018 mortgage approvals would average around 65,000 per

month. The January data show an upside surprise but it remains to be seen

whether this is just a one-off or the start of a upward trend.

     - Secured lending on dwellings rose by the weakest amount in nine months,

reflecting the soft number of approvals in previous months. There is evidence

that demand remains weak. The January RICs survey noted new buyer enquiries down

for the 10th straight month.

     - After rising following the November 25bp hike average interest rates on

the stock of mortgages and new mortgages dipped in January to 2.53% from 2.55%

in December and to 1.96% from 2.02% respectively. However, quoted rates,

lenders' shop window rates, suggest mortgage interest rates could head up again.

The 3-year fixed 75% LTV rate rose to 1.70% from 1.69% previously.

     - Consumers were reluctant to finance purchases via credit in January too,

with the change in unsecured credit the lowest since July (stg1.357bn). That

said, use of credit cards soared to the highest level since January 2005, up to

stg0.932bn in January from stg0.466bn in December. Use of 'other' means of

credit (overdrafts, etc.), on the other hand, sunk to the lowest level since

December 2014.

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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