UK house price growth slowed to a five-year low, with an annual rise of just 2% in June, according to Nationwide Building Society. Meanwhile, prices in London continued to decline, with a 1.9% year-on-year fall. “Subdued economic activity and ongoing pressure on household budgets is likely to continue to exert a modest drag on housing market activity and house price growth this year, though borrowing costs are likely to remain low,” said the society.

Nationwide is sticking with its forecast of 1% growth for the UK as a whole in 2018, although the North East has fared a little better than average. The lender also pointed out that despite London’s recent underperformance, prices in the capital were still more than 50% above their 2007 peak, while UK prices as a whole are only 15% higher.

UK economic growth during the first quarter was revised higher to 0.2% as the Office for National Statistics introduced a new method of estimating construction output. Previously, the ONS had estimated first-quarter growth at just 0.1%. ONS head of GDP Rob Kent-Smith said: “GDP growth was revised up slightly in the first three months of 2018, with later construction data and significantly improved methods for measuring the sector nudging up growth.” “These improved methods, introduced as part of ONS’s annual update to its figures, will lead to better early estimates of the construction sector with smaller revisions in the future.”

Consumer confidence in the UK dropped back again, having recently improved, according to a closely watched survey by GfK. Its consumer confidence index dropped two points to minus 9 in June, with a deterioration in expectations for both the UK economy (-25 vs -21 in May) and personal finances (+6 vs +8). GfK director Joe Staton said: “The overall index score has now registered at zero or negative for 30 months. Contrast that with 2015 – when there was a full year of positive numbers. The trend since 2015 has been resolutely downwards and it’s difficult to see the direction changing in the run-up to the UK leaving the European Union in March 2019.”

Consumer borrowing from UK banks grew at its slowest rate since 2015 in May, according to data from UK Finance. Total consumer borrowing, which includes personal loans, credit cards and overdrafts, grew at an annualised rate of 3.9%, its most sluggish for more than three years. The data adds to evidence that debt-driven spending by UK consumers appears to be losing momentum. However, mortgage lending rose 8.8%, due largely to an increase in remortgaging.

Last week saw the FTSE 100 index drop 2.2% to a seven-week low amid mounting US-China trade tensions. Carnival led the blue-chip fallers, dropping 11.1% as the world’s biggest cruise operator lowered its profit guidance.

Meanwhile, China’s Shanghai index entered bear market territory, having fallen 20% from its January high. Energy stocks helped the FTSE 100 to a 1.1% gain midweek, with BP up 3.4% as Brent crude topped $78. Whitbread was also up 3.4% despite lower sales at its Costa coffee chain (Company Announcements below). But Just Eat dropped 7.1% after investors took fright at management comments on costs and profitability. Shire added 3.1% last Thursday after Takeda shareholders rejected an attempt to block its takeover of the Irish drugmaker.