Australia’s home loans surprisingly shrink in May

The total value of new home loans for owner-occupied homes in Australia unexpectedly shrank in May, by 2% month-over-month to AUD 18.13 billion, following a revised up 4.5% increase in April.

In comparison, market consensus had pointed to a 2% growth in new home loans.

In May, construction of dwellings contracted 0.7% after a 6% rise in the prior month.

Purchases of existing dwellings also dropped, by 2.2% in May after a 3.7% surge in April.

In terms of geographical location, the value of new home loans shrank in:

– New South Wales (-7.9%);
– Northern Territory (-6.3%);
– Victoria (-2.4%);
– South Australia (-1.7%);
– the Australian Capital Territory (-1.4%).

On the other hand, the value of new home loans rose in:

– Tasmania (9.2%);
– West Australia (2.6%);
– Queensland (0.8%).

The Aussie Dollar was little changed on the day against the US Dollar, with the AUD/USD currency pair last trading at 0.6742.