Lending to property buyers grew only slightly in October while business loans contracted, according to statistics from the central bank that suggest the annual pace of credit has slowed to a nine and a half year low.
The numbers showed overall private sector credit grew by 0.1 per cent - below market expectations of a 0.3 per cent rise - and that credit for mortgages increased 0.3 per cent, credit to businesses was down 0.1 per cent and personal credit fell 0.6 per cent.
The financial aggregates data released by the Reserve Bank of Australia on Friday indicated overall credit rose 2.5 per cent in the 12 months to October - the lowest since April 2010.
Housing credit grew at an all-time annual low of 3.0 per cent, business credit gained 2.7 per cent and personal credit fell 4.7 per cent.
Loans to property investors edged 0.02 per cent lower during the month and shrank 0.2 per cent over the past year.
The negative year-on-year figure for speculators is the sharpest drop since the RBA started keeping track of the measure as a separate category in January 1991.
Owner-occupier credit increased 0.4 per cent in October, essentially the same as in the previous month, and was up 4.8 per cent on an annual basis.
While the 0.3 per cent rise in overall property lending in October was an increase from 0.2 per cent in September, the annual growth rate shrank to the lowest pace since Australian records started in 1976.
The contraction in lending to businesses during October was the first monthly drop since January 2017 and a result that ANZ analysts acknowledged "took us by surprise".
"The lack of a credit pulse across the Australian economy reflects both consumer and business caution," CommSec economist Ryan Felsman said.
Australian Associated Press