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Home loans in Australia inclined and job advertisements fell for the first time in three months

Mon, Nov 9 2009, 02:12 GMT
by ecPulse.com analysis team

ecPulse.com

Reports today showed that job advertisements in Australia declined in October giving signs that the nation's labor market remains unstable despite unemployment rate declined in September. On the other hand, home loans gained along with rising value of loans, while investment lending declined.

ANZ job advertisements in Australia fell for the first time in three months as it declined 1.7% in October compared with a previous incline by 4.4%, while on the yearly record, job advertisements declined 44.9%.

Today's decline in job advertisements in giving signs that the nation's labor market facing the negative effect of the global recession and the impact of the government's stimulus spending is waning. Unemployment rate unexpectedly declined in September to 5.7% from 5.8% in August that was added as a signs of recovery in the Australian economy.

On the other hand, the Reserve Bank of Australia said in its quarterly monetary policy statement that was released last week that employment growth is expected to be subdued this year before it accelerate during next year, while governor Stevens forecasted jobless rate to peak 6.0% that he considered a low peak.

Today's report showed that national vacancies advertised in newspapers and on the internet averaged 133,709 a week in October. News paper advertisements declined 1.4% to an average 8,800 a week, while internet advertisements slipped 1.8% to an average 124,909.

Moving to Home loans that rose the most in six months jumping 5.1% compared with a previous revised -1.9% from -0.6% and it came higher than analyst's estimates of 3.0%. Investment lending fell 0.1% from a prior revised 8.3% from 7.6%, while the value of loans inclined by 6.7% compared with a prior -1.7% that was revised to -2.7%.

However, the Australian Statistics Bureau said that first home buyers represented 26.1% of dwellings financed in September higher than the 24.7% in August.

Home loans increased amid rising demand in the property market after the government allocated cash incentives for first time buyers and existing home buyers. The government allocated A$21,000 for each first time buyer, and A$14,000 for existing home buyers to back consumer demand that appeared to be a pillar for economic growth since the beginning of the financial crisis.

Moreover, the continuous improve in demand along with rising house prices that gained 6.2% in the third quarter from a year earlier, may encourage the RBA to raise borrowing costs by another 25 basis points next month, having in mind that the nation's benchmark interest rate was raised by 0.25% last week following a similar decision in October.

Published on  Mon, Nov 9 2009, 02:14 GMT