Morning Forex Fundamental: GBP

Morning Forex Fundamental: GBP

'The FLS has achieved some success in bringing down mortgage rates, with some signs of a pickup in lending activity' - Robert Gardner, chief economist at Nationwide

Britain's house prices moved up in January, as the Bank of England's credit-easing programme helped loosen the mortgage market, the report by Nationwide Building Society showed Thursday. The average cost of a home added 0.5% from December to 162,245 pounds, while were unchanged from a year earlier. At the same time, estate agents around the country have consistently reported that this year we will see a rise in the number of transactions, as demand picks up. Wednesday's data, which showed a strong improvement in the number of mortgage approvals, and pickup in house prices are pointing at positive effect of Funding for Lending Scheme, which rewards banks, who increase their lending levels with access to cheaper funding, is having some success among customers.

'The FLS has achieved some success in bringing down mortgage rates, with some signs of a pickup in lending activity,' said Robert Gardner, chief economist at Nationwide. 'Hopefully, the momentum will continue to build in the months ahead, though much will depend on whether the wider economic environment improves.'

'While activity in the housing market remains muted by historic standards, there have been tentative signs of a pickup in activity in recent months.'