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REPEAT: MNI: Australia Mortgage Growth M/M Lowest Since Dec'12

Repeats Story Initially Transmitted at 02:00 GMT Jul 31/22:00 EST Jul 30
--Investor Mortgage Growth M/M Falls Third Time In Data History
By Sophia Rodrigues
     SYDNEY (MNI)  - Australia's housing credit growth slowed in June to a rate
last seen in December 2012 as fall in housing prices and tightening in lending
standards continues to take its toll on credit growth.
     On the face value, the data is comforting to the Reserve Bank of Australia
because slowing in housing credit amid slow income growth means the build-up of
risk in household balance sheets is being contained. But a fall in housing
market activity would also have implications for the economy because it might
impact household spending, and also the general activity in the economy.
     Data published by the RBA Tuesday showed overall credit grew 0.3% m/m in
June matching MNI median forecast for a 0.3% rise. In y/y terms, total credit
slowed to +3.2%, the lowest rate this year.
     The fall was driven by a slowing in housing credit which offset a rise in
business loan growth.
     Housing credit rose 0.3% m/m in June, the lowest rate since December 2012.
The y/y growth rate slowed to 5.6%, a pace last seen in January 2014. The
slowing in housing credit growth was due to a fall in investor loan growth which
declined 0.1% m/m, the first fall since February 2009. In the history of the
data going back to 1990, this is only the third occasion when investor mortgage
growth has declined.
     On a y/y basis, investor mortgage growth slowed to a new record low of
1.6%, compared with 2.0% growth seen in May.
     Business credit rose 0.3% in June, rebounding from a flat outcome in May
but the y/y pace slowed to 3.2% from 3.9% in May. Personal credit growth was
flat in June, following four straight months of fall. 
     Meanwhile, the data also showed the trend of slowing in money supply growth
in Australia continued in June with the pace of both M3 growth and broad money
declining. Both rose 0.2% m/m, leading to a slowing in y/y growth to 1.9% and
the lowest since 1992.
--MNI Sydney Bureau; tel: +61 2-9716-5467; email: sophia.rodrigues@marketnews.com

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