- UniCredit analysts
Housing market is one the key drivers behind the U.K.'s rapid expansion, hence, any data from the sector should provide a significant impact on the currency and markets. However, it seems that BoE's efforts to confuse minds of market participants are feeding through, as each fundamental report is having weaker impact than usually. Immediately after the release of the mortgage approvals from the central bank the Cable remained unchanged trading at 1.6981, staying around Friday's low of 1.6961. Nevertheless, later on Tuesday the Cable penetrated strong support as investors took the pair down again following Monday's narrow range.
Britain's mortgage approvals jumped to 67,196 in June following a revised 62,007 a month earlier. Analysts expected a reading of 63,000. That totalled a 2.1 billion in net mortgages, down from 2.3 billion a month ago. At the same time consumer credit eased to 418 million pounds. Demand for mortgages declined during the early months of 2014 after the implementation of the Mortgage Market Review. The recent data indicates a tentative slowdown in the heating housing market, which was one of the key concerns for policy makers. However, it is a question whether a loss of momentum in the sector is lasting, and whether the data leads to a substantial easing back in house price growth over the next several months.
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