Overall credit growth was stronger than expected during September, led by the strongest monthly growth in business credit in seven years, according to ANZ.
Research by ANZ and the Reserve Bank of Australia showed that total credit growth rose 0.8 per cent for the month, and was up 6.7 per cent year-on-year.
Business credit growth experienced the biggest monthly increase (1.2 per cent), and rose 6.3 per cent year-on-year.
“The outlook for business credit is also optimistic, given recent solid increases in business loan approvals and positive surveys of businesses’ capital expenditure expectations,” ANZ said.
“This will be a key component of Australia’s ongoing economic transition, as growth sources broaden outside the mining sector.”
Housing credit growth increased 0.6 per cent in September, and by 7.5 per cent year-on-year. Owner-occupied credit growth rose 0.7 per cent for the month, and by 5.8 per cent year-on-year, while investor credit growth lifted 0.5 per cent for the month, and by 10.4 per cent year-on-year.
“Housing investor lending eased further in September, with annualised quarterly growth now at 8.2 per cent, down from a peak of 11.3 per cent as recently as May,” ANZ noted.
“However, the owner-occupier segment has continued to post stronger growth, suggesting that there is some category-shifting at play in response to the July changes in investor lending criteria and increased investor mortgage rates.
“Nonetheless, the out-of-cycle mortgage rate increases in recent weeks (in response to increased mortgage capital requirements), which are not captured in today’s data, will likely see total housing credit growth ease from here.”
Personal credit growth saw the smallest monthly and year-on-year rise, up 0.1 per cent and 0.5 per cent respectively. ANZ said these results were likely hindered by soft wages growth, persistently high unemployment and tentative consumer confidence.