The December quarter has started the way the three months to September ended for the wider economy, showing early mixed signals about strength and direction.
Credit growth in October was again weak, especially for business lending, building approvals sparked up and new home sales enjoyed a small rise, as did home prices.
Later today we not only get the September quarter growth figures in the national accounts, we also will have the October retail sales, which will give us a better picture of the economy in October.
The Reserve Bank said yesterday that total lending rose by just 0.1% in October, the same as in September, compared with no increase in September and a fall of 0.1% in August.
It was an annual rate of just 3.3% in the year to October.
That was unchanged from the year to September and has been around the 3% level or a bit more now since mid year.
Clearly demand for finance in the private economy remains weak.
Housing credit rose 0.5% in October, unchanged from September and the weakest since February 2009.
That left the annual rate up 7.7% in the year to October, the lowest annual rate for 13 months and a continuing sign of sluggish demand for home loans.
Lending to private home buyers rose 0.6% in October after a rise of 0.5% in each of the preceding two months. The annual rate was unchanged at 8.1% in October from September.
The RBA said other personal credit increased by 0.2% over October, after increasing by 0.4% in September. Over the year to October other personal credit rose 2.4%.
But business credit fell by an unchanged 0.8% in October from September, to leave the annual growth rate at minus 3.2%, which was a bit better than the 3.7% fall in the year to September and 4% in the year to August.
While Australian Bureau of Statistics figures showed a 9.3% jump in building approvals in October, nearly all the growth came from the very volatile other private dwellings sector (home units etc).
The ABS said the rise was up on the 1.2% increase recorded in September, which was revised upwards.
The ABS figures showed a 1.5% rise in the number of private sector houses approved, the first in four months.
A 23.6% surge in the number of seasonally adjusted private sector other dwellings was the key change. That more than reversed the 14.8% drop in September and could have been due to councils catch up on approvals lodged months ago. For that reason these figures could show another big fall next month.
The ABS said the "seasonally adjusted estimate for the value of total building approved rose 4.1% in October.
"The seasonally adjusted estimate for the value of new residential building rose 8.2% and the value of residential alterations and additions rose 7.9%.
"The seasonally adjusted estimate for the value of non-residential building fell 3.8%."
That continued the weakness shown in the construction work done stats for the September quarter.
And finally, despite market expectations of a fall in home prices in October, the RPData-Rismark monthly survey showed a rise of 0.3%, bigger than the 0.1% rise in September.
“Since the market started to cool in June the cumulative decline in dwelling values to the end of October has been less than 1 per cent across the capitals, suggesting a market that is slowing at a controlled pace,” said RP Data research director Tim Lawless said in a statement.
The national city dwelling price was $460,000 in October, up from $455,000 in September.
Home prices in Sydney and Melbourne both rose 0.6%, seasonally adjusted, while they went backwards in Brisbane (down 0.2%) and Perth (a fall of 1.8%).
