Our Love Of Debt Is Slowly Deepening

Keith Haring, Untitled 1984 (Heart). Recreated by Giuseppina Arciresi.

The Reserve Bank of Australia (RBA) has just released its latest Financial Aggregates data.

It shows a overall debt rose 0.4% in August for a 5.1% annual growth rate compared to 3.3% a year ago.

Housing debt accelerated 0.6% for an annual rate of 6.7% compared to 4.7% a year ago.

Owner-occupied seasonally adjusted debt was $918.8 billion in August compared to $914.7 billion in August

Business credit was unchanged in August and the annual rate was 3.2%.

People appear to be avoiding personal debt. This was steady at 0.2% for an annual rate of 1.1%.

Chart: J.P. Morgan Australia

But the big news, which will worry the Reserve Bank and APRA and add to calls for macro-prudential rules, is the acceleration of the 12 month rate of growth of investment loans to 9.2%. That is the highest level since April 2008.

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