UK mortgage loans and consumer spending climb

British mortgage approvals hit a two-year high in January and consumer credit expanded at the fastest pace in a decade, according to Bank of England data likely to add to the case for a tightening of lending requirements by the central bank.

Mortgage approvals for house purchases numbered 74,581 in January from 71,335 in December. Meanwhile, consumer credit grew by 9.1% year-on-year in January, picking up speed from December to hit its fastest pace since January 2006.

Britain’s recovery is still heavily reliant on spending by households many of which have been buoyed by strong growth in the value of their homes.