Tuesday, July 31

Credit Aggregates for June 2012

The credit growth rate is growing - mostly on the back of accelerations in business credit and (to a much lesser extent) investor housing.

But before we get to the growth rates, let's have a quick look at the raw aggregates. And I should point out that there is no data for the investor housing and owner-occupied housing aggregates prior to 1990 (so ignore those pre-1990 zeros).

And on to the growth rates ... starting with some summary charts ...

The last three months has seen some growth in credit growth (below). What I like about this growth is that it is driven by an acceleration in credit to the business sector while the (less productivity enhancing) housing sector is growing at a historically low rate.


My gloom indicator continues to grow (albeit with a down tick in the last read).

So far (in this post GFC period), all of the movement in this index has been in the inversion between 2 and 3 year bonds. In the next two plots, I compare an index built on three comparisons (2-3, 3-5 and 5-10) and one that accumulates two comparisons (3-5 and 5-10). You can see in the second plot that nothing is happening in the latest period.

What is interesting is that while five year bonds continue to have a higher rate than three year bonds, they no longer have a higher yield than two year bonds. In the next chart we compare five and two year yields. A positive read shows an inversion. 

Just for completeness, the 2-3 and 3-5 yield gap charts follow.

Wednesday, July 25

Tuesday, July 24

Even more gloom

My gloom indicator (details in the comments here) keeps lurching upwards. Note this is the same indicator, but measured in basis points (rather than percentage points as it was previously).

If it gets to 20 basis points, I think I will become officially worried.

The longer run graph follows ...

Monday, July 23

More gloom

Regulars here know that I track the cumulative level of yield inversion in the bond rates at 3, 5 and 10 years. I use this inversion index as a rough barometer of market gloom.

Today's reading has inched up another notch to another post-GFC record.

Click on the bonds label below to see previous reports on this indicator.

A low inflation PPI

The Q2 2012 set of producer price indexes has been released by the ABS. It is largely consistent with low inflation in the production pipeline.

Sunday, July 22

Another look at the household sector

This time from RBA Table B20 ...

A quick reminder: TTY in the next set of graphs stands for 'through the year'. It is a comparison with the latest quarter for which we have data (March 2012) with the same quarter in the previous year.