According to UK Finance (the trade body representing high street banks) re-mortgaging continued to dominate in August as homeowners took advantage of a competitive market to lock into favourable deals. Growth in credit card spending also remained fairly strong, reflecting the boost to retail sales from the warm weather as well as the growing use of credit cards as a preferred means of payment.
Gross mortgage lending for the total market in August was £24.1bn, some 1.2 per cent lower than a year earlier however the number of mortgage approvals by the main high street banks in August rose by 0.7 per cent compared to the same month a year earlier. Within this, re-mortgaging approvals were 9.2 per cent higher than for the same period a year earlier. There was a fall in house purchase and other secured borrowing of 4.3 per cent and 2.1 per cent respectively.
Credit card spending was 7.6 per cent higher than last year, with increasing levels on card borrowing growing by 5.8 per cent over the year. Outstanding overdraft borrowing was 7.2 per cent lower compared to the same time last year. Against this personal deposits grew by 1.2 per cent in the last 12 months and deposits held in instant access accounts were 4.3 per cent higher than a year earlier.
Overall, according to UK Finance, the economic outlook remains mixed as household incomes continue to be squeezed by rising inflation.
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