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Australian Dollar Brushes Off Strong Lending Figures

ByFIBO Group
Published 02/11/2015, 09:28 AM
Updated 03/09/2019, 08:30 AM
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The Australian dollar has drifted lower today, brushing off the positive home loans figure that came in well above analysts’ expectations.

At 12.23am (AEDT) the Aussie dollar was trading at US77.40c down from US77.69c yesterday.

The Australian Bureau of Statistics reported that home loans in Australia rose by a seasonally adjusted 2.7 %, beating forecasts of a 2% increase and well up on the 0.7% decline in November.

Investor loans jumped 6% from November well above last month’s figure of -2.2% adding fuel to the fire of an already overheated housing market, with some predicting, such as Michael Workman, a senior economist from the Commonwealth Bank of Australia, that the government may have to intervene to cool things down,

“Today’s lending data may prompt additional controls over lending to investors in coming months,” he said.

Another reason behind the jump in figures is that investors may be trying to get in and take out new loans now before new legislation is introduced, according to Stephen Walters, chief economist at J.P. Morgan, Australia

“One possible driver of this upturn is the fear of looming macro prudential tightening, which may draw in a pool of marginal buyers wanting to get in before investor credit conditions get tighter,” Mr. Walters said.

The Aussie dollar may sit tight as the market awaits the release of key employment data tomorrow out of Australia.

The consensus is for an unemployment rate of 6.2%, up on last month’s figure of 6.1% with anything more likely to see the Aussie dollar break down through the US77.00c mark as fears grow of a jobs crisis developing in the local economy.

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