Bloomberg News

Foreign Investors Bought 4.31 Billion Pounds of Gilts Last Month

November 29, 2012

Overseas investors increased their holdings of U.K. government bonds for a fourth straight month in October, the Bank of England said today.

Non-residents bought 4.31 billion pounds more gilts than they sold last month, after increasing their holdings by 1.84 billion pounds in September, the data showed.

Separately, the central bank said U.K. money supply rose 0.2 percent in October from the previous month. From a year earlier, M4 fell 3.2 percent, the smallest annual decline since January.

A measure of M4 money-supply growth the central bank uses to assess the effectiveness of its asset purchases slowed to 5.4 percent from 7.5 percent. The gauge excludes financial companies that specialize in intermediating between banks, such as holding companies and non-bank credit grantors.

In another release, the Bank of England said the effective interest rate on new mortgages slipped to 3.74 percent in October from 3.77 percent in September. For existing secured loans, the rate was 3.39 percent, up from 3.36 percent. On new loans to companies, the effective interest rate increased to 2.92 percent from 2.72 percent.

The central bank accidentally published its monthly credit and lending data, including mortgage approvals, yesterday. That report had been scheduled to be released at 9:30 a.m. today.

To contact the reporter on this story: Jennifer Ryan in London at jryan13@bloomberg.net

To contact the editors responsible for this story: Craig Stirling at cstirling1@bloomberg.net


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