(3 August 2006 – Australia) East & Partners has revised its three year average growth outlook for business credit by 2.3 percent following yesterday’s Reserve Bank of Australia upward interest rate movement.The SME and Micro Business banking markets will be most impacted as two thirds
of current lending remains secured against the “family home”. Continued pressure
from input costs, in particular the high price of fuel, on enterprise growth
plans and a tightening labour market causing increasing professional labour
costs will further constrain the growth ambitions of small businesses.
Supporting the continued double digit growth in business lending, however, is
strong capital expenditure by middle market and SME businesses catching up on
historically depressed spending, strong cash flow outlooks and generally solid
balance sheet gearing.
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For more information please contact:
Paul Bartholomew
Senior Consultant
East & Partners
Tel: +61-2-9004 7848
Mob: +61-410 400 156
paul.b@eastandpartners.com