Australian private sector credit grew at the slowest pace in nearly seven years, providing just the latest mixed message on the current state of Australia’s housing market.
Australia’s housing credit expanded by 0.5 percent in July, leaving it up 6.6 percent on the levels of a year earlier, data released by the Reserve Bank of Australia’s (RBA’s) private sector credit survey showed Wednesday.
By component, credit to owner-occupiers increased by 0.5 percent, taking the annual rate of growth to 7.6 percent, little below the multi-year peak of 7.7 percent seen in June. Moreover, just 13 months ago, credit growth to investors had been running at an annual clip of 10.8 percent.
In absolute terms, the value of outstanding owner-occupier housing credit now stands at USD1.0236 billion, near double the USD552.6 billion figure for investors. Business credit increased by 0.3 percent, recovering from a 0.2 percent drop in June, leaving the annual pace of growth at 6.2 percent, the weakest seen since January.
Furthermore, housing, business and personal credit together grew by 0.4 percent for the month, in line with market expectations, leaving the annual expansion at 6 percent, a 13-month low. Also, personal credit fell by 0.1 percent for the seventh consecutive month during the June quarter, leaving the annual decline at 0.8 percent.