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March 29, 2018, 4:58 a.m. EDT

U.K. household borrowing at highest in 6 months

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By Paul Hannon

LONDON--New borrowing by U.K. households rose in February to its highest level since September 2017, as the Bank of England signaled a likely rise in its key interest rate.

Britons borrowed an additional 5.4 billion pounds during the month, up from 4.8 billion pounds in January. The increase was driven by new mortgage borrowing, which also rose to its highest level since September, as well as unsecured loans. Borrowing via credit cards fell slightly.

Figures released by the BOE Thursday suggested mortgage borrowing may slow over coming months, with approvals of new loans secured on home purchases falling to 63,910 from 67,110 in January, below the average of the previous six months.

The BOE has signaled that it is likely to raise its key interest rate over coming months, and economists have penciled in May as the most probable date, since policy makers will then publish new forecasts for growth and inflation.

The BOE last raised its key rate in November, which was its first increase since the onset of the global financial crisis.

Write to Paul Hannon at Paul.Hannon@wsj.com

Dow Jones Newswires

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