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British banks approved the second-lowest number of mortgages since the start of 2015 last month, as icy weather appeared to exacerbate an already-muted housing market in much of Britain.

Banks gave the green light to 37,567 mortgages for house purchase last month, trade association UK Finance said, the lowest since December and the second-lowest since January 2015.

“It is possible that mortgage approvals … were affected by the severe weather (but) even allowing for this, the underlying performance points to the housing market remaining muted,” said Howard Archer, chief economic advisor at consultants EY ITEM Club.

Consumer spending power has been squeezed by a year of high inflation since sterling fell after Britain voted to leave the European Union, and higher property taxes and concern over Brexit has hurt demand for high-end property in the London area.

Seasonally adjusted net credit card lending increased by just 10 million pounds ($13.9 million) on the month – the smallest rise since April 2016 – though the annual growth rate was little changed at 5.8 percent.

Net lending to businesses was its highest in a year at 3.241 billion pounds.

Archer said the prospect of higher interest rates might also be weighing on home-buyers.

Financial investors are unsure if the Bank of England will raise interest rates next month – something they had previously thought was highly likely – after Governor Mark Carney highlighted recent “mixed” economic data.

Thursday’s UK Finance data cover major British banks, but do not include building societies, which account for a big chunk of mortgage lending.

The Bank of England releases industry-wide data on May 1.

Source: UK Reuters

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