Deposit growth eases

APRA has released April deposit growth figures and we are seeing possible stabilisation at around the 7% year on year level, though the down trend is intact:

Months on month is still trending down as well:

And the aggregate growth rate leveling off:

Still, at least growth did not show any adverse effects yet from the falling dollar. I expect we will see some deposit outflow as currency risk returns.

FYI, given deposits make up about 60% of bank funding and APRA insists on dollar for dollar deposits in for new loans going out (to keep a lid on offshore borrowing) the current growth rate in deposits equates to 4-4.5% aggregate potential lending growth.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.