Release Explanation: This report tracks developments in the number and value of outstanding home loans in Australia. Home Loans are a measure of activity in the housing market. The figure acts as a gauge for consumer confidence, since consumers usually take out large loans only when they have sufficient saving or believe they will be able to pay them back in the future.
The sales of a new home usually trigger a sequence of consumption. In addition to the high expenditure of the new home, buyers are likely to spend more money on furnishing and customizing their home. Consequently, growth in the housing market spurs more consumption, generating demand for goods, services and the employees to provide them. Thus an n increase in loans may forecasts growth in the economy.
Trade Desk Thoughts: Home loans in Australia came in at 3.5 percent which is slightly lower than analysts forecasts of a 4.0 percent read. In seasonally adjusted terms, dwelling finance commitments increased 0.7 percent while owner occupied and investment housing grew at 2.3 percent and 3.8 percent respectively.
Forex Technical Reaction: The Australian gained from the lows seen during yesterday’s session but was quickly rejected from the neutral pivot point and is currently trading relatively flat.