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Uk July Mortgage Approvals Unexpectedly Strong

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LONDON (Reuters) - Mortgage approvals for house purchases were stronger than expected in July, wrongfooting analysts who had expected a fall, according to Bank of England data on Thursday.

The Bank said approvals -- a leading indicator of the strength of the housing market -- held steady at 115,000 last month after an upwardly revised June figure, beating analysts forecasts for a fall to 110,000.

Sterling rose against the dollar and the euro as the figures rekindled speculation that interest rates may need to rise again before the end of the year.

LONDON (Reuters) - Mortgage approvals for house purchases were stronger than expected in July, wrongfooting analysts who had expected a fall, according to Bank of England data on Thursday.

The Bank said approvals -- a leading indicator of the strength of the housing market -- held steady at 115,000 last month after an upwardly revised June figure, beating analysts forecasts for a fall to 110,000.

Sterling rose against the dollar and the euro as the figures rekindled speculation that interest rates may need to rise again before the end of the year.

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LONDON (Reuters) - Mortgage approvals for house purchases were stronger than expected in July, wrongfooting analysts who had expected a fall, according to Bank of England data on Thursday.

The Bank said approvals -- a leading indicator of the strength of the housing market -- held steady at 115,000 last month after an upwardly revised June figure, beating analysts forecasts for a fall to 110,000.

Sterling rose against the dollar and the euro as the figures rekindled speculation that interest rates may need to rise again before the end of the year.

LONDON (Reuters) - Mortgage approvals for house purchases were stronger than expected in July, wrongfooting analysts who had expected a fall, according to Bank of England data on Thursday.

The Bank said approvals -- a leading indicator of the strength of the housing market -- held steady at 115,000 last month after an upwardly revised June figure, beating analysts forecasts for a fall to 110,000.

Sterling rose against the dollar and the euro as the figures rekindled speculation that interest rates may need to rise again before the end of the year.

No need for the BoE to lower rates, in fact I would say that a rise is in order!

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Sterling rose against the dollar and the euro as the figures rekindled speculation that interest rates may need to rise again before the end of the year.

given that the BoE do not target house prices, why would strong mortgage approvals lead to ir hikes? Do mortgage approvals indicate likely inflationary pressure?

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How does this square with Nationwide's claim that 'new buyer enquiries have collapsed' ?. Is there a lag in the data ? Will we see mortgage approvals collapse in a month or two ?

For now it seems the Great British public just cannot give up the debt habit - just one more fix then we'll be right.

Still as money supply is still running out of control I am sure we can look forward to another rate rise inspite of Ms Earleys protestations.

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So Many reports showing very different views. I do wonder who all these people are taking out new mortgages? Looking at Beckton and price range against average salary Im suprised anyone can afford a mortgage.

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We've had this for years, one report contradicting another, it just means the BoE can use it as an excuse to 'wait and see'.

The trend is still inexorably up.

Edited by simon99

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Guest DissipatedYouthIsValuable
So Many reports showing very different views. I do wonder who all these people are taking out new mortgages? Looking at Beckton and price range against average salary Im suprised anyone can afford a mortgage.

'Wealthy Overseas Investors' obviously. They're limitless you know. Voracious buyers.

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given that the BoE do not target house prices, why would strong mortgage approvals lead to ir hikes? Do mortgage approvals indicate likely inflationary pressure?

I think it's more along the lines of "No need to make rates artificially low to try to save a faltering market".

Officially the BoE only target one thing - 2% CPI. Unofficially it's pretty clear that there is pressure to protect stock and housing markets. The absolutely loony rate cut in Aug 2005 should be proof of that.

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How does this square with Nationwide's claim that 'new buyer enquiries have collapsed' ?. Is there a lag in the data ? Will we see mortgage approvals collapse in a month or two ?

For now it seems the Great British public just cannot give up the debt habit - just one more fix then we'll be right.

Still as money supply is still running out of control I am sure we can look forward to another rate rise inspite of Ms Earleys protestations.

...I should think there is a data lag...most of these approvals would have been initiated in June and some in May.....remember the full horror of sub prime only became really big news beginning of August.......interesting that remortgaging fell May 110,000, June 103,000 and July to 101,000...... :o:o:o

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given that the BoE do not target house prices, why would strong mortgage approvals lead to ir hikes? Do mortgage approvals indicate likely inflationary pressure?

It's just the usual idiot reporting that confuses one thing with another. Because it is possible and is sometimes the case that some market or other may be thought to affect the price of something else, then they get ideas in their little heads and cannot get them out.

I believe it makes them feel like they know what they're talking about. It's the usual mélange. When I worked in the markets as a strategist I was never once quoted correctly; not one single time, and I was often quoted two or three times a day. I once sat with two Guardian journalists for a couple of hours trying to explain something about the Asian currency crisis. The following Saturday it was a front page story and they had changed my words into the exact opposite of what I had said. (I did not complain for I deemed it ‘cool’ to be the only analyst on a front page story.) They wanted to write what they wanted to write. (They wanted to talk shit about Soros instead of talking sense about the markets.)

When I worked as a journo I always took great pains to quote people correctly. In fact I got a few people great jobs by only ever quoting them after figures had been released and they had been correct (which I knew before deadline but it made it look as if they were not ‘picked’ from a random bunch). I was accused by proper journos who saw All the President's Men of sucking up to market types instead of intrepid reporting (like wot they did).

Financial reporting is mostly a joke and most of what’s reported is reported by kids with idiot degrees in journalism (where they learn about inverted pyramids for four years). As soon as anyone does it long enough to grasp anything they move jobs, or join the happy throng who bore us every day with their editorials (not unlike this post).

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QUOTE(starsign @ Aug 30 2007, 10:13 AM)

given that the BoE do not target house prices, why would strong mortgage approvals lead to ir hikes? Do mortgage approvals indicate likely inflationary pressure?

It's just the usual idiot reporting that confuses one thing with another. Because it is possible and is sometimes the case that some market or other may be thought to affect the price of something else, then they get ideas in their little heads and cannot get them out.

I believe it makes them feel like they know what they're talking about. It's the usual mélange. When I worked in the markets as a strategist I was never once quoted correctly; not one single time, and I was often quoted two or three times a day. I once sat with two Guardian journalists for a couple of hours trying to explain something about the Asian currency crisis. The following Saturday it was a front page story and they had changed my words into the exact opposite of what I had said. (I did not complain for I deemed it ‘cool’ to be the only analyst on a front page story.) They wanted to write what they wanted to write. (They wanted to talk shit about Soros instead of talking sense about the markets.)

When I worked as a journo I always took great pains to quote people correctly. In fact I got a few people great jobs by only ever quoting them after figures had been released and they had been correct (which I knew before deadline but it made it look as if they were not ‘picked’ from a random bunch). I was accused by proper journos who saw All the President's Men of sucking up to market types instead of intrepid reporting (like wot they did).

Financial reporting is mostly a joke and most of what’s reported is reported by kids with idiot degrees in journalism (where they learn about inverted pyramids for four years). As soon as anyone does it long enough to grasp anything they move jobs, or join the happy throng who bore us every day with their editorials (not unlike this post).

The BoE MPC have to consider lots of factors when targetting inflation. One of these factors is domestic demand.

Maybe you should try reading the inflation report

Domestic Demand

A key issue facing the Committee is judging the underlying

momentum in domestic demand in the wake of the increases

in Bank Rate over the past year. Smoothing through

short-term volatility, consumer spending growth appears to

have been surprisingly resilient in the face of those increases in

Bank Rate, as well as subdued growth in real take-home pay.

That resilience may in part reflect relatively slow pass-through

of Bank Rate increases to the interest rates faced by

households. But slower growth in retail sales during the

second quarter, signs of easing in the housing market and

reports from the Bank’s regional Agents suggest that spending

growth may have started to ease.

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