GBP:
New data
suggests to some analysts that the Help to Buy is doing very little. 7,313
mortgages were completed in the first six months of the government’s mortgage
guarantee scheme, equivalent to 1.3% of all mortgage completions. With that being
said, 80% have gone to first-time buyers.

The stats also
show that Help to Buy has been most popular with households earning between

GBP:
New data
suggests to some analysts that the Help to Buy is doing very little. 7,313
mortgages were completed in the first six months of the government’s mortgage
guarantee scheme, equivalent to 1.3% of all mortgage completions. With that being
said, 80% have gone to first-time buyers.

The stats also
show that Help to Buy has been most popular with households earning between
£30,000 and £40,000, and to buy properties worth £125,000 or less.

It is possible
that the BoE might start watering down the scheme in its annual review in
September despite providing a government guarantee of 15% of the property
value, making it possible to get a mortgage with just a 5% deposit.

The data backs
up the argument that the scheme is not fuelling the boom in top-end properties;
but is helping people onto the bottom of the an increasingly steep property
ladder.

USD:
American growth
figures show GDP fell by an annualised rate of 1.0% in Q1 as companies cut back
on investment and restocking their inventories. For the US it was the first
quarterly decline since a 1.3% drop in the first three months of 2011.

This year’s dip
reflected slower stockpiling by businesses, a cutback in business investment
and a wider trade deficit. Exports also slipped by 6%, making another dent in
economic output. Corporate profits sank by 9.8% in the first quarter, the
biggest decline in almost six years.

Economists are
looking for a strong rebound in the April-June quarter as the country shakes
off the effects of a severe winter.

Although the
majority of economists expected the first quarter to contract, the data
suggests that American firms were hit even harder by the awful wintery weather
than first thought, however are expecting a bounce back for the second quarter,
especially as consumer spending was good even with the economy contracting at
the time.

On a positive
note, the number of people filing new jobless claims fell to just 300,000 last
week, down from 327,000. And the continued claims figure (those who had been
claiming for more than a week) slid to 2.631m, the lowest level since November
2007.

Today:
The main focus
today is on the USA and employment data. As always on the last Friday of every
month USA Nonfarm payrolls are released, this month they are expected to fall
from 288k to 215k. Coupled with this the unemployment rate is released which is
expected to stay the same at 6.3%.

Announcements:

09:30 – UK – Total Trade Balance, last month’s figures show a
£1.284B deficit
13:30 – USD – Nonfarm Payrolls (May) expected to fall 215k
13:30 – USD – Unemployment
Rate (May) expected to stay the same at 6.3%

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