In March, Australia’s private sector credit growth is expected to have remained stable at 6.6% y/y, according to Societe Generale. However, there has been a shift in sectoral composition. Housing loans growth is gradually topping out at annual rates of about 7¼, whereas loans to businesses are quickening steadily, noted Societe Generale. This implies that growth in investment spending is shifting to largely driven by business investment spending from being restricted to real estate sector.
Business loans are likely to have accelerated further in March. Meanwhile, a renewed shift seems to be appearing in housing loans. Loans to housing investors had abruptly decelerated as regulators leaned on banks to decelerate housing investor loans to lower than 10%. They were actually slowed to 7.6% by February and are likely to further slow to 7.2% in March, said Societe Generale. In the mean time, other personal loans demand continues to be non-existent.
