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(M2) Correction Extends


Late Session Rebound


(M2) Corrective Cycle Remains In Play


(M2) Gains Still Considered Corrective

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Repeats Story Initially Transmitted at 00:50 GMT Oct 3/20:50 EST Oct 2
     SYDNEY (MNI) - From building-approvals data for August published by the
Australian Bureau of Statistics on Tuesday:
                                            August                          July
                              (M/M% unless stated;          (M/M% unless stated;
                              seasonally adjusted)          seasonally adjusted)
Dwelling Units
Approved                                      +0.4      -1.2 (revised from -1.7)
MNI Median                +1.0(range -3.0 to +3.0)
Dwelling Units
Approved (Trend)                              +1.1                          +1.3
Dwelling Units
Approved Y/Y                                 -15.5  -13.9 (last month's release)
Private Houses                                +0.6                          +1.0
Private Units
Excluding Houses                              +4.8                          -6.6
     FACTORS: The number of dwellings approved rose slightly in August, leading
to an acceleration in trend growth.  The small rise in August pushed trend to
+1.1% in August from the 0.7% m/m pace originally reported in July (with July
also revised up to 1.3%) and so far this year the trend growth was negative only
in the month of January. The latest increase in dwelling approvals was mainly
due to a 4.8% m/m rise in multi-unit approvals, which has risen for three months
in a row in trend terms. House approvals fell 0.6% m/m and in trend terms rose
for the sixth straight month, though the pace slowed to +0.9% in August from
+1.2% in July. The overall rise in dwelling approvals was mainly due to an
increase in Queensland approvals which offset a fall in New South Wales and a
small drop in Victoria.
     Total building approvals by value fell 5.0% in August, due mainly to a
15.7% decline in non-residential building approvals that offset a 2.2% rise in
residential approvals.
     TAKEAWAY: The outcome was lower than a MNI median forecast but within the
range predicted by economists in the survey. Despite a slight acceleration in
trend approvals, the data are in line with the Reserve Bank's forecast that the
pipeline of dwelling work to be done will start to fall over the forecast
period. "The contribution to GDP growth from dwelling investment over the
forecast period is expected to be minimal," the RBA said.
--MNI Sydney Bureau; tel: +61 2-9716-5467; email:

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