U.K. unsecured borrowing continued to grow rapidly in May, official data showed Thursday, suggesting British consumers increasingly rely on credit cards, personal loans and overdrafts to support spending amid accelerating inflation and tepid wage growth.
British households' consumer credit grew by GBP1.7 billion last month, the Bank of England's data showed.
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This was well above the GBP1.4 billion forecast of analysts polled by The Wall Street Journal, and translated into an annual pace of growth of 10.3%.
Britain's unsecured borrowing has been growing at a double-digit annual rate for several months now, raising concerns that U.K. shoppers may be living beyond their means. Earlier this week, the BOE ordered banks to begin rebuilding buffers of capital, which it had allowed them to run down to keep credit flowing after the Brexit vote in June.
The instruction to start rebuilding the capital buffers to pre-referendum levels came amid an intensifying debate among BOE policymakers over whether to begin gradually increasing borrowing costs.
Separately, the BOE data also showed that the number of new mortgages approved in May held broadly steady, at 65,202, compared with 65,051 the previous month.
Write to Wiktor Szary at Wiktor.Szary@wsj.com
(END) Dow Jones Newswires
June 29, 2017 05:00 ET (09:00 GMT)