The latest credit aggregates continues to show the same trends, with housing up again overall by 0.66%, but with investment lending still running at 0.9%, whilst owner occupied lending was 0.51% higher in the month. As a result, the share of investment loans rose again, to 34.46%, from 34.37% last month. So the housing investment skew continues. More food for thought against further interest rate cuts. Total housing lending is running at an annual growth rate of 7.3%, up from 5.9% this time last year.
Overall lending was 0.48% higher, with business lending growing just 0.19%, and personal credit 0.24%. Worryingly again we see a fall in the ratio of business lending to total credit, so once again, the banks are much happier meeting demand for house loans than helping business to borrow for productive purposes. We are not sure lower interest rates would stir business into action in the current environment, and with current lending policy and capital ratios in play. We think rates will stay on hold.
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