Aussie Private Credit Hits 3-Month Peak
Australia’s private sector credit rose 0.7% m/m in July 2025, accelerating from back-to-back 0.6% gains and marking the fastest pace since April. The print topped market expectations of 0.6%, pointing to resilient financing demand despite still-elevated interest rates.
The upside surprise was driven by a sharp rebound in business credit, which jumped 1.4% m/m (vs 0.5% in June), suggesting firms are re-engaging in working-capital needs, investment, and expansion. Housing credit growth held steady at 0.5% m/m, underscoring a still-firm property market, while personal credit eased notably to 0.4% from 0.8%, signaling cautious household appetite for borrowing.
On an annual basis, private credit expanded 7.2% y/y, up from 6.9% in the prior two months and the strongest pace since February 2023. The strengthening year-on-year momentum indicates credit flows remain broadly expansionary across the economy.
Policy outlook: The combination of robust business credit and steady housing credit could keep the central bank cautious about near-term easing, even as softer personal credit hints that household consumption has yet to fully recover. Markets will watch upcoming inflation, labor, and retail data to gauge the durability of this credit upswing.
Source: Newsmaker.id
