Here is a chart of the latest RBA financial aggregates data. Property investor housing credit continues to rise on an annualised basis, while owner-occupied lending continues to fall.
More worrying for the RBA will be the poor level of business credit, which is still negative (declining). This suggests that the banks remain rather unwilling to lend to business, which they perceive as 'risky' (and rightly so) compared to the relative safety of residential property.
Can the RBA keep raising rates while business credit growth is in such a bad way? It certainly makes it more difficult for them.
Total credit provided to the private sector by financial intermediaries rose by 0.1 per cent over September 2010, following an increase of 0.1 per cent over August. Over the year to September, total credit rose by 3.3 per cent.
Housing credit increased by 0.6 per cent over September, following an increase of 0.6 per cent over August. Over the year to September, housing credit rose by 8.0 per cent. Housing credit rose over September due to growth in lending to both owner-occupiers and investors.
Other personal credit increased by 0.3 per cent over September, after falling by 0.2 per cent in August. Over the year to September, other personal credit increased by 2.8 per cent.
Business credit fell by 0.9 per cent over September, following a fall of 0.7 per cent over August. Over the year to September, business credit declined by 3.7 per cent.
Over the month of September, M3 rose by 0.4 per cent and broad money increased by 0.3 per cent. Over the year to September, broad money grew by 5.4 per cent.
This means the RBA will have to think hard before yanking rates up too much, which in turn means the Banks will be pressured to be more prudent with rate movements.
Nobody here seems to understand how to read time-series data. The overall trend for both OO and Investor is both down. Furthermore, the Total Credit growth trend is especially alarming, about 80% down from peak to now, after a period of stable growth. This is what's important. That is what all you mice should be looking at.
Nobody here seems to understand how to read time-series data. The overall trend for both OO and Investor is both down. Furthermore, the Total Credit growth trend is especially alarming, about 80% down from peak to now, after a period of stable growth. This is what's important. That is what all you mice should be looking at.
The annualised trend for investor housing finance is up, from around 3% annualised in 2009, to 8% annualised now.
Monthly it has been flat since April.
Agree OO rate of growth is trending down over the past few months.
Nobody here seems to understand how to read time-series data. The overall trend for both OO and Investor is both down. Furthermore, the Total Credit growth trend is especially alarming, about 80% down from peak to now, after a period of stable growth. This is what's important. That is what all you mice should be looking at.
The trend for investor housing finance is up, from around 3% annualised in 2009, to 8% annualised now.
Monthly it has been flat since April.
Agree OO is trending down over the past few months.
Meaningless, the overall trend is down. That's how to read line graphs.
Oh I see, the fact that the annualised trendline is pointing up means the annualised trend is going down... right...
Don't know how to read line graphs. Line graphs are used to explain trends over time. Trends need to be looked at in context of events, not to make mice tales.
Total credit growth down bout 80% from peak to now.
Even fool can look at line graph and understand significance of events, which real value of time-series data. Mice trying to build narrative but story meaningless. Also fool don't understand that credit growth not just function of inflation.
Nobody here seems to understand how to read time-series data. The overall trend for both OO and Investor is both down. Furthermore, the Total Credit growth trend is especially alarming, about 80% down from peak to now, after a period of stable growth. This is what's important. That is what all you mice should be looking at.
yet up more recently from a trough, yes???
you are cherry picking dates to find the trend which suits you most!!!
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