The Reserve Bank of Australia (RBA) has just released the private sector credit aggregates data for the month of February:
Total credit provided to the private sector by financial intermediaries rose by 0.2 per cent over February 2013 after increasing by 0.2 per cent over January. Over the year to February, total credit rose by 3.4 per cent.
Housing credit increased by 0.4 per cent over February following an increase of 0.4 per cent over January. Over the year to February, housing credit rose by 4.4 per cent.
Other personal credit increased by 0.1 per cent over February after decreasing by 0.1 per cent over January. Over the year to February, other personal credit decreased by 0.3 per cent.
Business credit decreased by 0.2 per cent over February after being unchanged over January. Over the year to February, business credit increased by 2.3 per cent.
A chart showing the long-run breakdown in the components is provided below:
As you can see, personal credit growth (0.1% MoM; 0.3% QoQ; -0.3% YoY) has until recently been deleveraging, whereas business credit growth (-0.2% MoM; 0.5% QoQ; 2.3% YoY) and housing credit growth (0.4% MoM; 1.1% QoQ; 4.4% YoY) remains positive in annual terms, but are at subdued levels relative to their long-run average growth rates.
Focusing on the housing market, annual credit growth has now hit a fresh all time (36-year) low of 4.41%. However, as shown by the below chart, housing credit growth looks like it might have bottomed (at least for the time being):
Finally, a breakdown of owner-occupied credit (0.3% MoM; 1.0% QoQ; 3.9% YoY) and investor credit (0.4% MoM; 1.3% QoQ; 5.6% YoY) is provided below:
As you can see, much of the current mortgage demand is being driven by investors, which has also been reflected in recent housing finance data from the Australian Bureau of Statistics.
