An economist says a sharp fall in the number of people taking out home loans is unlikely to stop the Reserve Bank from raising interest rates at its next board meeting in February – according to Yahoo Finance news.
Seasonally adjusted figures released today by the Australian Bureau of Statistics show 59,516 new loans for owner-occupied housing were taken out in November – a 5.6 per cent drop on the previous month.
The average economist forecast was for a 2.3 per cent fall.
The slump was driven almost entirely by a big drop in the number of first home buyers.
November was the second month after the Government’s First Home Owner Boost (FHOB) was halved, and was also the second month in a row in which the Reserve Bank lifted interest rates.
Helen Kevans from JP Morgan says while the Reserve Bank will consider these latest figures, they are not severe enough to prevent another rate rise, particularly given the large rise in retail sales in November.
“Given the other data that we’ve seen lately – particularly those retail sales numbers – it looks like the Australian economy is still proving largely resilient and has come out of this global downturn unscathed,” she said.
“And with capacity constraints building and inflationary pressures building, we do think the RBA will be tightening policy again in February.”
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