Australia Pvt Sector Credit Growth Supported By Housing Credit

--Private Sector Credit +0.5% M/M in July

     SYDNEY (MNI) - Private-sector credit data for July published by the Reserve

Bank of Australia on Thursday:

                                 July          June          July          June

-------------------------------------------------------------------------------

                         % Change m/m  % Change m/m  % Change y/y  % Change y/y

Total Credit                     +0.5          +0.6          +5.3          +5.4

Housing                          +0.5          +0.5          +6.6          +6.6

-Owner-occupier Housing          +0.5          +0.6          +6.1          +6.1

-Investor Housing                +0.4          +0.4          +7.4          +7.4

Business                         +0.5          +0.8          +4.2          +4.3

Other Personal                   -0.1          -0.1          -1.4          -1.4

     FACTORS: Total private-sector credit growth slowed in July due mainly to a

slower pace of business credit growth, while housing credit rose at the same

pace as June and other personal credit fell for the 19th straight month. On a

y/y basis, other personal credit fell 1.4% for the third month in a row,

recording falls of more than 1.0% for 13 consecutive months. Investor mortgage

growth rose at the same pace as June, despite the latest month seeing a switch

from investor to owner-occupier mortgages of A$1.4 billion. Partly explaining

the continued switch is a rise in mortgage rates for investor loans in the past

few months. 

     TAKEAWAY: The data shows private sector credit growth has slowed from the

6%-plus growth pace posted in 2016. While some slowing in housing credit has

contributed to the decline, the overall pace of mortgage growth continues to

remain high. The minutes of the Reserve Bank of Australia's August board meeting

suggested some renewed concern over housing market and household balance sheets,

with the central bank saying they continue to "warrant close monitoring." It

indicates the decline seen so far in mortgage credit growth may be less than the

RBA expected. 

--MNI Sydney Bureau; tel: +61 2-9716-5467; email: sophia.rodrigues@marketnews.com

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