UK: Money and credit data in the limelight today – RBC CM

Research Team at RBC Capital Markets, suggests that the mortgage approvals and the money supply data will be in focus for the UK markets as far as today’s session is concerned.

Key Quotes

“Mortgage approvals have been falling fast (that is arguably as much to do with stamp duty changes as it is referendum effects) so another drop this month could see the MPC’s expected monthly average of 56k being hit after recording 60.9k last month. Referendum volatility is difficult to judge but the RICS survey details do suggest that one of the initial reactions to the result was lower activity levels in terms of both new instructions and buyer enquiries. This makes it difficult to be too optimistic about mortgage approvals in the short-term.

Also look out for the Bank of England’s favoured measure of money supply (M4 ex IOFCs) which jumped to 14.7% 3m saar in July. It is too soon to know if that will turn out to be a blip or not, so the out-of-vogue money supply data should receive a little more attention than usual for the next few months. This is so we can see whether or not the pick-up in growth is sustained and, if it is, whether or not it becomes more central to the policy outlook.”