Banks to lend more but output suffers
UK LENDERS are to make mortgage loans more easily available, according to Bank of England research.
The Bank’s Credit Conditions Survey said availability of mortgages had decreased in the third quarter due to a deterioration in wholesale funding markets.
But it said lenders expect more home loans to be offered in the final quarter as the housing market and the economy improve.
And the survey showed that corporate lending had increased in the quarter, with further increases forecast.
However, the positive news was dampened by data from the Chartered Institute of Purchasing & Supply (CIPS), which said that manufacturing continued its decline in September. The CIPS index surprised analysts, falling to 49.5 from 49.7 in August, any figure below 50 showing contraction.
Eurozone unemployment data did little to lighten the mood, with joblessness hitting a 10-year high of 9.6 per cent.
In the US, confidence appears to be returning, as consumer spending beat expectations to jump 1.3 per cent in August, the largest gain since October 2001 and a fourth consecutive monthly rise.
But a report from the Labour Department showed that applicants for state unemployment insurance climbing to a seasonally adjusted 551,000 from 534,000 in the previous week.
And the Institute for Supply Management indicated a decline in manufacturing activity, as its monthly national factory index declined to 52.6 from 52.9, well below a median forecast of 54, but still in positive territory.