Overall lending on the decrease
(17 February 2010 – Australia) An economist for CommSec has said that the central bank’s decision to leave interest rates unchanged this month was supported by a decline in total lending commitments in December.
Craig James, chief economist for CommSec said that the 1.3 percent fall in total new lending commitments in December was disappointing, as it was the second drop in the last three months.
Lending is back down on a year ago, down overall 3.3 percent, Mr James added.
Compared to November 2009, December’s total value of owner occupied housing commitments excluding alterations and additions decreased 1.4 percent in trend terms and the seasonally adjusted series decreased 4.7 percent.
Total commercial finance commitments decreased 0.8 percent. Revolving credit commitments decreased 2.1 percent and fixed lending commitments decreased 0.3 percent.
The seasonally adjusted series for the value of total commercial finance commitments was flat at A$26.7 billion. Revolving credit commitments rose 3.8 percent, while fixed lending commitments fell 1.3 percent.
The total value of lease finance commitments increased 0.6 percent in trend terms and the seasonally adjusted series increased 8.7 percent.
Housing finance for owner occupation fell 4.7 percent to A$15.526 billion in December, the third consecutive monthly decline.
In the final three months of 2009, housing finance fell 11.6 percent, Mr James said.
It is understandable why the Reserve Bank paused in the interest rate cycle because there is a degree of uncertainty at the moment, Mr James added.
In particular around the first home owners boost and what will happen after that boost finished at the end of last year, Mr James highlighted.
Lending is back down on a year ago, down overall 3.3 percent, Mr James added.
Compared to November 2009, December’s total value of owner occupied housing commitments excluding alterations and additions decreased 1.4 percent in trend terms and the seasonally adjusted series decreased 4.7 percent.
Total commercial finance commitments decreased 0.8 percent. Revolving credit commitments decreased 2.1 percent and fixed lending commitments decreased 0.3 percent.
The seasonally adjusted series for the value of total commercial finance commitments was flat at A$26.7 billion. Revolving credit commitments rose 3.8 percent, while fixed lending commitments fell 1.3 percent.
The total value of lease finance commitments increased 0.6 percent in trend terms and the seasonally adjusted series increased 8.7 percent.
Housing finance for owner occupation fell 4.7 percent to A$15.526 billion in December, the third consecutive monthly decline.
In the final three months of 2009, housing finance fell 11.6 percent, Mr James said.
It is understandable why the Reserve Bank paused in the interest rate cycle because there is a degree of uncertainty at the moment, Mr James added.
In particular around the first home owners boost and what will happen after that boost finished at the end of last year, Mr James highlighted.
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