Total credit provided to the private sector by financial intermediaries fell by 0.2 per cent over September 2009, following an increase of 0.2 per cent over August in a sign that demand for loans may not be as strong as expected. Over the year to September, total credit still rose by 1.7 per cent.

Housing credit increased by 0.7 per cent over September, following an increase of 0.8 per cent over August. Over the year to September, housing credit rose by 7.7 per cent largely due to a surge in the middle of 2009. The Reserve Bank of Australia said that upgraders and investors had driven the growth, a positive sign as the number of first homebuyers falls from record highs.

Other personal credit fell by 0.2 per cent over September, following a rise of 0.4 per cent over August. Over the year to September, other personal credit fell by 5.6 per cent as consumers remained cautious.

The business sector was again the biggest laggard in the data, with credit declining by 1.3 per cent over September 2009, following a fall of 0.7 per cent over August. Over the year to September, business credit declined by 4.6 per cent.