UK house prices fell for the first time in eight years in June, a closely-watched survey showed. This dampens hopes of a sustained recovery in the sector. House prices were 0.1 per cent lower in June than the same month a year ago − the first annual fall since December 2012 − according to mortgage lender Nationwide.
The same data set shows that property values dropped by 1.4 per cent compared with May, as the coronavirus lockdown hit the housing market. The monthly fall was, however, less severe than a 1.7 per cent decline recorded in May. Nationwide said the outlook for the housing market was “highly uncertain” in the coming months.
Separately, the Bank of England reported that approvals of mortgages to purchase a home tumbled to 9,300 in May, their lowest level on record, from an already unprecedented low of 15,851 in April.
Meanwhile, the number of people out of work in Germany rose far less than expected in June, data by the Federal Labour Agency showed on Wednesday, calming fears of mass layoffs in Europe’s largest economy.
Unemployment surged in June, taking the number of job losses in the second quarter to 678,000 and the total to 2.943 million people, just below the three million threshold that has not been broken since 2011. The unemployment rate was pushed to 6.4 per cent from 6.3 per cent the previous month.
The number of redundancies was kept down thanks to generous state wage support, according to the agency.
Finally, in the US, the minutes of the most recent Federal Reserve monetary policy meeting published on Wednesday show that officials had an in-depth discussion about capping bond yields and strengthening guidance about where policy will be set in the future.
Policymakers note that “the current stance of monetary policy remained appropriate” but said the Fed should strengthen the guidance it provides to markets.
The minutes noted a need for “highly accommodative monetary policy for some time” and said the conditions for that should be spelled out clearly.
The central bankers left interest rates at close to zero at the session, as expected, and said they anticipate loose monetary policy to prevail until the economy gets back to normal.
This report was compiled by Bank of Valletta Ltd for general information purposes only.