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MNI: UK Data F'casts Aug Public Sector Fin, UK Mortg Approvals

MNI (London)
By Jamie Satchithanantham
     LONDON (MNI) - UK public sector finances recorded a surplus of stg0.2bn in
July, the first July surplus in fifteen years, after a stg0.3bn shortfall last
     The surplus was courtesy of an increase in self-assessment income tax
receipts, but was  flattered by timing effects. The deadline for tax returns
fell on a Sunday last year causing a spill over of receipts into August. That
means some form of payback this August will have materialised. 
     Alongside this, higher debt interest repayments, which will continue to
rise on the back of rising inflation (CPI and RPI rose to 2.9% and 3.9%
respectively in August) will persist in boosting borrowing levels seen this
financial year.     
     Borrowing is expected to come in at stg7.3bn in August, above the stg6.8bn
reading recorded last August.  
                    Public Finances-
                             PSNB ex
                              stg bn
Date Out                      21-Sep
Median                           7.3
Forecast High                    7.9
Forecast Low                     7.0
Standard Deviation               0.3
Count                             10
Prior                           -0.2
Capital Economics                7.5
HSBC                             7.9
Investec                         7.8
Lloyds TSB                       7.1
Morgan Stanley                   7.0
Nomura                           7.5
Oxford Economics                 7.0
Pantheon                         7.2
RBC                              7.0
Societe Generale                 7.3
     Year-to-date borrowing is up 9% on the same period last year, a lot smaller
than the 29% increase projected for the 2017/18 financial year as a whole.
Though this trend is not expected to continue throughout the rest of the
financial year, revisions to OBR figures from last year could potentially reduce
the divergence to some extent.    
     Since the March Budget and the OBR's forecast for 2016/17 borrowing,
initially placed at stg52bn, the actual number has been revised down some 13% to
     Also due Thursday are the UK Finance (formerly BBA) UK mortgage approvals.
In recent months house price growth has lost pace while approvals have slipped
away from levels set last year as household grapple with squeezed incomes and
increased economic ambiguity. 
     Analysts do not think this dampened sentiment would have washed away in
August and pencil in approvals declining to 40.8k from 41.6k in July.   
     This would be consistent with the most recent RICS survey which saw its
measure of new buyer enquiries drop into negative territory for much of 2017. It
held firm at -4 in August.   
                            UK Finance
                    Mortgage Approvals
Date Out                        21-Sep
Median                            40.8
Forecast High                     42.4
Forecast Low                       9.0
Standard Deviation                18.8
Count                                3
Prior                             41.6
Capital Economics                  9.0
HSBC                              42.4
Pantheon                          40.8
--MNI London Bureau; +44 203-586-2226; email:
MNI London Bureau | +44 203-865-3812 |

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