UK Growth remains subdued, borrowing falls slightly

Economic growth has risen marginally in Q2, up from 0.2% in Q1 to 0.3% in the three months to June. Year-on-year, growth has fallen from 2% to 1.7%, showing a slowdown is taking place, but nonetheless reflects a resilient economy considering inflation has been picking up throughout the year. Whilst the GDP figures were in line with average forecasts, new UK mortgage approvals have slightly beaten forecasts, with total mortgage borrowing remaining relatively flat at around £13 billion. 40,200 new mortgages were approved in June, down from 40,287 in May. Other borrowing such as personal loans have fallen slightly (around 1%), yet annual growth in credit card borrowing has remained flat at 5.5%. Today's releases come as little surprise, allowing UK equity markets to continue making gains today and for UK bonds to see strength. Sterling is relatively flat against major currencies ahead of the US Federal Reserve Meeting later today.