Ruth Lea CBE has been Arbuthnot Banking Group’s Economic Adviser since 2007 and was an Independent Non-Executive Director from 2005-2016.

Ruth co-founded Global Vision in 2007 and was Director until 2010, and was previously the Director of the Centre for Policy Studies (from 2004 to 2007), Head of the Policy Unit at the Institute of Directors (from 1995 to 2003) and Economics Editor at ITN (from 1994 to 1995).  Prior to ITN she was Chief UK Economist at Lehman Brothers, Chief Economist at Mitsubishi Bank, worked for 16 years in the Civil Service (the Treasury, the DTI, the Civil Service College and the Central Statistical Office) and was an economics lecturer at Thames Polytechnic (now the University of Greenwich).

She is the author of many papers and articles on economic issues and has been a Governor of the London School of Economics and Council Member of the University of London.

Tel: 020 8346 3482
Mobile: 07800 608 674
Email: ruthlea@arbuthnot.co.uk

 

From the desk of Ruth Lea

Economic insight and financial comment related to the ever-changing financial landscape and the economic world at large.

Economic Perspectives

9th September 2019

Economic Insight - 9 September 2019

Spending Round 2019: planned to comply with current fiscal rules
In this Perspective Ruth Lea, Economic Adviser to the Arbuthnot Banking Group, discusses the Spending Round 2019:
Press Release

Spending Round 2019: planned to comply with current fiscal rules

Date: 9th September 2019

Spending Round 2019: planned to comply with current fiscal rules
In this Perspective Ruth Lea, Economic Adviser to the Arbuthnot Banking Group, discusses the Spending Round 2019:
    • The Spending Round 2019 sets out the government’s plans for the Resource Departmental Expenditure Limits (RDEL), the departmental day-to-day spending plans, for FY2020. Capital budgets were already in place for FY2020.
    • A full multi-year spending review is planned to follow in 2020.
    • In cash terms, the plans increased total public sector spending by £2.1bn in FY2019 (all RDEL) and by a significant £13.4bn in FY2020 (£11.7bn for RDEL and £1.7bn for Capital DEL (CDEL)) compared with previous projections.
    • Total RDEL is planned to increase by 4.1% (YOY) in FY2020 in real terms, a real terms increase of £13.8bn. The largest YOY rises are for the NHS (£4.1bn) and education (£2.2bn).
    • The Spending Round 2019 was planned to comply with the current fiscal rules: keeping the structural deficit below 2% of GDP in FY2020 and debt falling as a % of GDP.
    • The spending plans were based on the OBR’s economic forecasts for the Spring Statement (March 2019). New forecasts are to be provided in the Budget (date to be announced).
    Concerning other UK economic developments:
    • The annual growth of consumer (unsecured) credit was 5.5% in July, unchanged from June.
    • The Bank described the mortgage market as “broadly stable” in July, though the net mortgage borrowing by households and the number of mortgage approvals for house purchase both picked up in July.
    • The Markit surveys for all three sectors weakened in August. Manufacturing and construction showed (slightly faster) contractions, whilst services growth slowed. Markit estimated that GDP could fall 0.1% (QOQ) in 2019Q3.
    Concerning the Central Banks:
    • The ECB, the Fed and the Bank of England are all due to make monetary policy announcements over the next fortnight.
    • The ECB is expected to provide more monetary stimulus, to help the slowing Eurozone economy.
    • There remain expectations that the Fed will cut interest rates again in September, after the July cut, despite the Fed’s attempts to dampen expectations.
    • The Bank of England is expected to leave monetary policy unchanged.
    • Finally, the Bank has revised its estimates of the economic fall-out of a “disorderly no deal Brexit”. In November 2018, they said there would be an initial peak-to-trough decline in GDP of 8%. This has been modified to a 5½% decline in GDP.
    There have been major political developments in the last fortnight:
    • The PM announced the next Queen’s Speech for 14 October 2019 on 28 August. Parliament would be prorogued from 9-12 September (date to be announced) to 14 October.
    • A Motion (under Standing Order No 24), designed to take control of the Commons’ agenda from the Government for the following day, was passed on 3 September. This guaranteed time for the “European Union (Withdrawal) (No. 6) Bill 2019”, intended to avoid a “no deal” Brexit, to be debated in the Commons on 4 September.
    • The “European Union (Withdrawal) (No. 6) Bill 2019” was passed by the Commons on 4 September and by the Lords on 6 September.
    • The PM lost a Motion for a general election (for 15 October) on 4 September. He failed to get the necessary 2/3rds majority of MPs in the Commons.
    • The Government formally lost its majority (of 1) when a Conservative MP defected to the LibDems on 3 September. In addition, 21 Conservative MPs lost the whip after voting for the 3 September Motion and Amber Rudd resigned from the Conservative party on 7 September.


    Ruth Lea said, “…the Spending Round 2019 stated that it had been ‘delivered within the current fiscal rules’. Crucially, this assessment allowed for the significant increase (£13.4bn, cash terms) in spending plans for FY2020. Given the recent weakness in the public finances, this may be a challenge. But it is important to emphasise that the first fiscal rule refers to the structural (cyclically adjusted) deficit so, if the economy weakens, adjustments are made to the actual deficit to compensate. The Chancellor has said he will review the fiscal framework ahead of the Budget.”

For full story: http://www.arbuthnotgroup.com/economic_perspectives_group.html

Press enquiries:

Arbuthnot Banking Group PLC:

Ruth Lea, Economic Adviser
07800 608 674, 020 8346 3482
ruthlea@arbuthnot.co.uk
Follow Ruth on Twitter @RuthLeaEcon

Maitland:
Sam Cartwright
020 7379 4415
Jais Mehaji
020 7379 5151
arbuthnot@maitland.co.uk
Download full article

27th August 2019

Economic Insight - 27 August 2019

Fears of recession: overdone in the US but maybe not in Germany
In this Perspective Ruth Lea, Economic Adviser to the Arbuthnot Banking Group, discusses some recent developments in the US and the EU:
Press Release

Fears of recession: overdone in the US but maybe not in Germany

Date: 27th August 2019

Fears of recession: overdone in the US but maybe not in Germany
In this Perspective Ruth Lea, Economic Adviser to the Arbuthnot Banking Group, discusses some recent developments in the US and the EU:
    • Recession fears mounted in the US when the spread between the yield on the 10-year Treasury note and that on the 2-year note initially, and briefly, turned negative in mid-August (“yield curve inversion”).
    • This specific metric has been a reliable, though not totally reliable, predictor of US recessions over the past 50 years.
    • US economic fundamentals are, however, firm and do not point to recession in forthcoming quarters.
    • German GDP slipped 0.1% (QOQ) in 2019Q2 to be just 0.4% higher YOY. The Bundesbank warned that weakness was expected to continue in 2019Q3, leaving the economy on the brink of a technical recession, defined as two consecutive quarters of negative GDP growth.
    • German industrial production fell 1.8% (MOM) in July, to be 6.2% lower YOY. The German economy is disproportionately affected by changes in production, as the sector accounts for over 25% of GDP, compared with 14% in, for example, the UK.
    • For the EU28 as a whole, GDP rose 0.2% in 2019Q2, with reasonable growth in Spain, the Netherlands and, especially, Poland (of the major EU economies). French GDP rose 0.2%, whilst Italian GDP was stagnant.
    Concerning UK developments:
    • Public sector net borrowing (PSNB) showed a disappointing surplus of £1.3bn in July 2019, compared with a surplus of £3.6bn in July 2018.
    • The cumulative PSNB for the first four months of FY2019 was £16.0bn compared with £10.0bn in FY2018.
    • The OBR forecast a PSNB of £29.3bn in March 2019, compared with the current outturn of £23.6bn for FY2018. The chances are that the OBR’s forecast will be overshot, curbing the Chancellor’s scope for a fiscal boost in the Budget.
    • The ONS is making methodological changes (including the treatment of student loans) from September, which result in an increase in PSNB in FY2018 of £13.3bn and will increase the PSNB by similar amounts going forward. This also curbs the Chancellor’s scope for a fiscal boost.


    Ruth Lea said, “…the markets’ reaction to the inverted yield curve in mid-August, and the possibility of recession in the US, seem very overdone. Former Fed Chair Janet Yellen’s comments, that the inverted yield curve was a “less good signal” of recession “on this occasion”, and that the US “has enough strength” to avoid recession, seem reasonable. But Germany’s economy does seem to be on the brink of technical recession or, at best, a period of stagnation as its heavily production weighted, and export-led, economy suffers from the slowdown in world trade growth.”

For full story: http://www.arbuthnotgroup.com/economic_perspectives_group.html

Press enquiries:

Arbuthnot Banking Group PLC:

Ruth Lea, Economic Adviser
07800 608 674, 020 8346 3482
ruthlea@arbuthnot.co.uk
Follow Ruth on Twitter @RuthLeaEcon

Maitland:
Sam Cartwright
020 7379 4415
Jais Mehaji
020 7379 5151
arbuthnot@maitland.co.uk
Download full article

12345678910 (2018)(2017)

Comment, at a glance

Retail sales rose 0.6% in 3 months to August
19 September 2019

Retail sales rose a moderate 0.6% (QOQ) in the three months to August to be 3.3% higher (YOY) (table 1). The ONS commented that growth in non-store retailing being the main contributor to the quarterly increase.

Retail sales fell 0.2% (MOM) in the month of August, to be 2.7% higher YOY. The ONS commented that non-store retailing was the largest contributor to this fall, partially offsetting the strong growth reported last month for this sector.

Online retailing slipped to 19.7% of total retailing in August, compared with 19.9% in July. 

Read more
House price inflation slows to 0.7% in July
18 September 2019

According to official data, UK average house prices inflation in July was 0.7% (YOY), compared with June’s revised 1.4% (Figure 1). The ONS commented “…this is the lowest annual rate since September 2012, when it was 0.4%. Over the past three years, there has been a general slowdown in UK house price growth, driven mainly by a slowdown in the south and east of England. The lowest annual growth (in July) was in the North East, where prices fell by 2.9% (YOY); this was followed by the South East, where prices fell by 2.0% (YOY).”

Prices fell 0.3% (MOM) seasonally adjusted in July; they rose 0.5% (MOM) non-seasonally adjusted.

The UK’s four countries continued to show different inflation rates in July: England (+0.3% YOY, 1.1% in June), Wales (+4.2% YOY, 4.3% in June), Scotland (+1.4% YOY, 2.0% in June) and Northern Ireland (+3.5% (2019Q2, YOY)).

In England, there was, as always, a significant range across the regions (figure 4). The complete list of annual price changes is: Yorkshire & Humberside (3.2%), North West (2.3%), East Midlands (1.9%), West Midlands (1.8%), South West (0.7%), East (-0.5%), London (-1.4%), South East (-2.0%), and North East (-2.9%).

Read more
CPIH, CPI inflation rates fall to 1.7% in August
18 September 2019
The CPIH inflation rate decreased to 1.7% in August, compared with 2.0% in July. (CPIH is the Consumer Prices Index including owner-occupiers’ housing costs and is the ONS’s preferred measure of consumer prices inflation.) The ONS said “…the largest downward contributions to the change in the CPIH 12-month rate between July and August 2019 came from a range of recreational and cultural goods and services (principally games, toys and hobbies, and cultural services), clothing and sea fares. Rises in air fares resulted in the largest, offsetting, upward contribution to change”.

The inflation rates for goods and services in August were 1.2% (1.7% in July) and 2.0% (2.2% in July) respectively. The core rate inflation (excluding energy, food, alcoholic beverages & tobacco) decreased to 1.5% (1.9% in July). The Consumer Prices Index (CPI) 12-month rate also fell to 1.7%, compared with July’s 2.1%.

Turning to the producer price index (PPI), the inflation rate for the output PPI (goods leaving the factory gate) was 1.6% (YOY) in August (down from July’s 1.9%, table 1). The ONS reported that transport equipment provided the largest upward (sic) contribution to the annual rate of output inflation.

The inflation rate for the input PPI (materials and fuels used in the manufacturing process) fell to minus 0.8% (YOY) in August, compared with plus 0.9% in July (table 3). The ONS commented that crude oil provided the largest downward contribution to the annual rate of input inflation. Crude oil prices fell 0.6% (MOM) in August, and were 2.1% lower YOY (table 5). 

The annual rate of inflation for imported materials and fuels fell to minus 0.1% (YOY) in August (down from July’s plus 0.4%, table 4). Imported materials and fuels represent roughly two-thirds of overall materials and fuels (input prices) in terms of index weight. The sterling effective exchange rate index (ERI) depreciated 1.7% (MOM) in August, to be 3.4% lower YOY (table 4).

All in all, these reports suggest that prices inflation is fairly well contained.

 

Read more
Annual labour costs per hour rise 3.4% in 2019Q2
13 September 2019
The ONS reported that the annual growth in labour costs per hour for employees across the whole economy increased by 3.4% in 2019Q2. Within the total, wage costs per hour were 3.7% higher (YOY) whilst non-wage costs (such as pensions and National Insurance contributions) per hour were 2.7% higher (YOY).

Growth was lower in the private sector (3.1%) than the public sector (4.0%). This pattern is consistent with recent quarters but is a reversal of the pattern seen from late 2014 to late 2017. The recent pattern has been driven by changing levels of bonus and arrears payments. This has been affected by the health and social work subsector in which the timing of pay rises for some NHS staff is different in 2019 compared with 2018. When both bonus and arrears payments are excluded, the difference in labour cost growth between private and public sectors is smaller.

The industry with the largest labour costs per hour in 2019Q2 was the finance and insurance activities industry, at £44.30 per hour, followed by the mining and quarrying industry at £35.40 per hour. Labour costs per hour were lowest in the accommodation and food service activities industry, at £10.60 per hour.

 

Read more
Annual labour costs per hour rise 3.4% in 2019Q2
13 September 2019
The ONS reported that the annual growth in labour costs per hour for employees across the whole economy increased by 3.4% in 2019Q2. Within the total, wage costs per hour were 3.7% higher (YOY) whilst non-wage costs (such as pensions and National Insurance contributions) per hour were 2.7% higher (YOY).

Growth was lower in the private sector (3.1%) than the public sector (4.0%). This pattern is consistent with recent quarters but is a reversal of the pattern seen from late 2014 to late 2017. The recent pattern has been driven by changing levels of bonus and arrears payments. This has been affected by the health and social work subsector in which the timing of pay rises for some NHS staff is different in 2019 compared with 2018. When both bonus and arrears payments are excluded, the difference in labour cost growth between private and public sectors is smaller.

The industry with the largest labour costs per hour in 2019Q2 was the finance and insurance activities industry, at £44.30 per hour, followed by the mining and quarrying industry at £35.40 per hour. Labour costs per hour were lowest in the accommodation and food service activities industry, at £10.60 per hour.

 

Read more
Unemployment rate 3.8% in the three months to July; total annual earnings growth was 4.0%
10 September 2019
Employment rose by 31,000 (QOQ) in the three months to July to 32.78mn, and was 369,000 higher (YOY) (table 1 of the ONS’s labour market overview bulletin). The annual increase of 369,000 was mainly as a result of more people working full-time (up 305,000 on the year to reach 24.17mn). Part-time working showed an increase of 65,000 on the year to reach 8.60mn.

The employment rate (the proportion of people aged from 16 to 64 who were in work) was 76.1%, the joint-highest on record since comparable records began in 1971. The employment rates for men and women were 80.2% and 72.1% respectively. The recent increase in the employment rate for women is partly due to ongoing changes to the State Pension age for women resulting in fewer women retiring between the ages of 60 and 65.

Unemployment was 1.29mn in the three months to July, 11,000 lower than the previous quarter and 64,000 down YOY (table 1). The unemployment rate (the proportion of the labour force that were unemployed) was 3.8%, compared with 4.0% a year earlier. It has not been lower since October-December 1974. The inactivity rate (the proportion of people aged 16-64 who were economically inactive) was 20.8%, compared with 21.2% a year earlier.

Job vacancies remain strong, though they have eased since the beginning of 2019. There were 812,000 job vacancies in the three months to August 2019 (sic), still at near-record levels since comparable records began in 2001. The number was down 23,000 (QOQ) and 33,000 lower (YOY).

The rate of pay growth has been trending upwards since mid-2017. In the three months to July 2019, that trend continued for total pay (including bonuses), which rose to 4.0%, but annual growth in regular pay (excluding bonuses) slipped a tad to 3.8%. In real terms (after adjusting for inflation), annual growth in total pay was estimated to be 2.1% and annual growth in regular pay was estimated to be 1.9%.

All in all, this report suggests the labour market remains robust, though employment growth may be slowing and vacancies have eased.

Read more
Trade (goods & services) deficit narrowed in three months to July
9 September 2019

The total trade (goods & services) deficit was £2.9bn in the three months to July, compared with a deficit of £17.8bn in the three months to April, a narrowing of £14.9bn, largely due to falling imports of goods (table 1). Excluding unspecified goods (including non-monetary gold (NMG)), the total trade deficit (goods and services) narrowed by just £3.7bn to £4.7bn in the three months to July. This gives a more accurate assessment of the underlying state of the trade position. 

Concerning goods (visible) trade:
·       The deficit was £29.3bn in the three months to July, compared with £44.2bn in the three months to April, a narrowing of £14.9bn. Imports of goods fell a very significant 10.6% whilst exports rose by 0.9%. Imports of unspecified goods (including non-monetary gold (NMG)), chemicals, and machinery and transport equipment fell significantly. The ONS said “…falling imports in the three months to July 2019, following the increases in the three months to April 2019, are consistent with activity being brought forward ahead of the UK’s originally intended departure date from the EU (29 March), but we are unable to quantify the effect of this”.
·       The deficit with EU countries was £21.1bn in the three months to July, compared with £25.2bn in the three months to April, a narrowing of £4.1bn (table 2).
·       The deficit with non-EU countries was £8.2bn in the three months to July, compared with £19.1bn in the three months to April, a narrowing of £10.8bn (table 2).

The services surplus fell modestly (by £0.1bn, rounded) to £26.4bn. Exports were down 1.5% (QOQ), whilst imports were down 2.3% (QOQ).  

Removing the effect of inflation, the total trade deficit narrowed £18.2bn to £1.4bn in the three months to July, acting as a major boost to constant price GDP growth (in expenditure terms), other things being equal.

Read more
GDP grew 0.3% in July; flat in the three months to July
9 September 2019
GDP rose 0.3% (MOM) in July, after a flat (MOM) June, and was 1.0% (YOY) higher (table GVA3). Within GDP:
·       Services output rose 0.3% (MOM) in July, after a flat (MOM) June. The ONS said there was widespread growth in a number of industries. The most notable of these was administrative and support service activities, which contributed 0.08 percentage points to GDP growth. However, this relatively large growth for services in July follows four consecutive months of flat “growth” in the sector.
·       Production increased by 0.1% (MOM) in July, following a fall of 0.1% (MOM) in June.
·       Within production, manufacturing grew by 0.3% (MOM) in July, following a contraction of 0.2% in June. The growth came from the often-volatile manufacture of pharmaceutical products, which grew by 3.8%.
·       Construction output rose by 0.5% (MOM), after June’s 0.7% decline. The ONS reported that this increase was driven by private new housing and public housing repair and maintenance, which grew by 4.4% and 7.8% respectively. The increase in private new housing coincides with a fall of 11.7% in public new housing, a reversal of the picture seen in recent periods.

The monthly growth rates for gross domestic product (GDP) are volatile and therefore should be used with caution and alongside other measures such as the three-month growth rate when looking for indicators of the longer-term trend of the economy. However, they are useful in highlighting one-off changes that can be masked by three-month growth rates.

In the three months to July, GDP was flat (QOQ), compared with the 0.4% (QOQ) rise in the three months to April, to be 1.1% higher than a year earlier (table GVA1). GDP fell 0.2% in 2019Q2. Within GDP:
·       The services sector continued to show subdued growth, rising by 0.2% (QOQ), after increasing 0.3% in the three months to April. The ONS said the longer-term weakening in services growth had been most notable in “other services”, which has declined from the start of 2019. A number of industries have been driving this decline, such as administration and support services, human health activities, education, real estate, and transportation and storage. Information and communication, on the other hand, driven by computer programming, continued to do well throughout this period.
·       The production sector fell by 0.5% (QOQ) in the three months to July 2019; it grew 0.5% in the three months to April. There has been significant volatility in this sector throughout the first half of 2019, largely driven by manufacturing. Elsewhere in production, electricity and gas performed well in the three months to July, growing by 2.8%.
·       Manufacturing fell 1.1% (QOQ) in the three months to July. The ONS commented “2019Q1 saw strong growth as a result of work being brought forward ahead of the UK’s original planned date to exit the EU. There was subsequently a fall in 2019Q2, as the increased activity in 2019Q1 unwound. This fall in 2019Q2 was exacerbated by a decline in car production as a result of car production plants bringing forward their summer shut-downs.
·       Construction output fell 0.8% (QOQ) in the three months to July 2019. This fall was driven by private housing repair and maintenance and public other new work, which fell by 6.3% and 6.2% respectively.

Read more
Markit Surveys for August weaken
4 September 2019
 ·       The much-followed Markit/CIPS surveys suggested manufacturing, construction and services all weakened in August. The Markit/CIPS manufacturing PMI fell to 47.4 in August, compared with 48.0 in July, below the 50.0 no-change threshold. The high levels of economic and political uncertainty pervasive across domestic and global markets continued to weigh heavily during August. Output volumes fell as intakes of new work contracted at the fastest pace for over seven years, while business optimism dropped to a series-record low. (Data released on 2 September 2019.)
·       The Markit/CIPS construction PMI fell to 45.0 in August, compared with 45.3 in July, also below the 50.0 no-change threshold. All three broad categories of construction work decreased in August, led by commercial building. Survey respondents continued to note that Brexit-related uncertainty had encouraged risk aversion and tighter budget setting among clients. Civil engineering activity also dropped at a relatively sharp pace during August. In contrast, house building fell only slightly and the rate of decline was the least marked since the downturn began in June. (Data released on 3 September 2019.) 
·       The Markit/CIPS services PMI fell to 50.6 in August, compared with 51.4 in July, but just above the 50.0 no-change threshold. UK service providers indicated that business activity growth lost momentum during August and remained subdued in comparison to the trends seen over much of the past decade. The latest survey also revealed slower increases in new work and staffing levels, which was often linked to sluggish underlying economic conditions. (Data released on 4 September 2019.)

·       Markit commented that “…the PMI surveys are so far indicating a 0.1% contraction of GDP in 2019Q3. While the current downturn remains only mild overall, the summer’s malaise could intensify as we move into autumn. Companies have grown increasingly gloomy about the outlook due to the political situation and uncertainty surrounding Brexit, adding to downside risks in coming months”.

Read more
Consumer credit annual growth unchanged at 5.5% in July, some strengthening in mortgage market
30 August 2019
 Concerning lending to individuals the Bank of England announced: 
·       Consumer credit increased by £0.9bn in July, broadly in line with the average seen over the past year. The annual growth was 5.5% in July, unchanged from June, and markedly lower than its peak of 10.9% seen in November 2016. This slowing reflects the weaker monthly lending flows over most of the past year. (Money & Credit statistical release, table B).
·       Mortgage market activity has remained broadly stable, notwithstanding some strengthening in key indicators.
·       Net mortgage borrowing by households picked up in July, rising to £4.6bn. While this was the strongest since March 2016, it reflected a fall in repayments rather than an increase in new lending. The annual growth rate was 3.2%, compared with 3.1% in June, and close to the level seen since 2016 (table D).
·       The number of mortgage approvals for house purchase, which give an indication of future mortgage lending, was 67,306 in July, compared with June’s 66,506 (table E). And they were up on the previous six months average (65,661) though well down on the recent peak of nearly 75,000 (January 2014). They were also well down on the monthly data recorded in the years prior to the recession, when mortgage approvals averaged 104,000 (2007), 119,000 (2006) and 100,000 (2005). The Bank noted that July’s figure “…was the strongest since July 2017, but remains within the very narrow range seen over the past two years”.

 

Businesses can raise money by borrowing from UK banks (in the form of loans) or financial markets (in the form of bonds, equity and commercial paper). Private non-financial corporations (PNFCs) repaid £2.5bn to these sources in July, the first net repayment since February (table F). Within this:
·       There was a £2bn net repayment to banks (monetary financial institutions (MFIs)).
·       UK businesses (PNFCs) also made net repayments to financial markets. Net repayments of equity were £0.9bn in July, whilst net repayments of commercial paper (a form of short-term borrowing from financial markets) were £0.7bn. This was the fifth consecutive month of net repayments of commercial paper. However, net bond issuance (a form of longer-term borrowing from financial markets) by businesses was positive, at £0.5bn in July, but below the £1.3bn average issuance over the past 6 months.

Net bank lending to non-financial businesses (which includes lending to businesses in the public sector) fell by £4.2bn in July, showing a YOY increase of 3.0%, compared with June’s 4.4% (table G). Loans to large businesses decreased by £4.2bn, whilst loans to SMEs were just £0.1bn lower. The growth rate of lending to large businesses eased to 4.2% (YOY in July (6.4% in June)), while the growth rate for SMEs was unchanged at 0.8% (YOY).

 

Read more