Friday’s private sector credit data from the Reserve Bank of Australia (RBA) revealed that the stock of personal credit, which was already in terminal decline, collapsed by 10.5% in the year to June – the biggest plunge in recorded history:
As shown above, this decline in personal credit growth easily exceeds the troughs of the GFC (-7.8%) and the early 1990s recession (-6.0%).
It also follows a spate of data showing collapsing consumer demand, all of which largely pre-dates the COVID-19 lockdown.
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