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Tuesday, 24 January 2017

Lending finance jumps to 9-year high

Lending bites

There was a 14.8 per cent seasonally adjusted jump in commercial finance in the month of November, taking commercial finance up to 5.9 per cent higher than a year ago. 

Property investment loans were a key driver of the increase, although housing finance for owner-occupiers was flat in the month.

Click on the charts to expand them, as always! 



Piecing it all together lending finance spiked 9.8 per cent higher in November, following a 0.6 per cent rise in October. 

All up, then, total lending finance jumped to $76.3 billion, the strongest monthly result since 2007 and the third strongest month on record.

In trend terms, total lending finance is now just a fraction below the highs recorded in 2015. 


There has been a small rebound in commercial lending to the mining industry since September, supported by the commodity prices surge, while the construction, storage, and transport sectors have seen moderate increases. 


Animal spirits?

Business seem to be making some use of low rates, with the economy and full-time hiring apparently picking up a bit of pace again into the end of 2016, following a soggy patch.

It very much looks as though interest rates will be on hold for a long while to come now, but Wednesday's inflation figures will be watched closely as always.