Bank lending to business and home buyers remains critically weak, according to the latest data from the Bank of England, endangering the revival in the housing market and the wider economic recovery.
Bank lending to “real economy” firms rose by just £100m in February – 0.3 per cent – and mortgage approvals fell back again.
The news comes as the revised figures for GDP growth in the fourth quarter of last year are due today. An upgrade from 0.3 per cent to 0.4 per cent is expected, but economists are more concerned about a setback in the early months of this year.
Some of the fallback in mortgages can be attributed to the depressing effects of the rush to borrow before the stamp duty holiday ended on 31 December, but analysts point out that the underlying trend remains feeble.
Read More: – By Sean O’Grady, the Independent