- Warren Hogan, ANZ chief economist
Australia's home loans unexpectedly declined in November, pointing to weakening in the residential sector even as interest rates remain at all-time low. The number of home-loan approvals dropped by 0.7% from October, according to the Australian Bureau of Statistics. In contrast, economists had expected a 1.7% increase. Australia's housing sector has been buoyant for several years. Growth has been particularly solid in recent months underpinned by an increase in investment buying fuelled by cheap available credit. Interest rates have remained at a historic low of 2.5% since August 2013. The sharp advance in home prices has been a concern for the Australian Reserve Bank of Australia, which is trying to prevent the housing market from overheating.
Meanwhile, a separate report showed that an ongoing increase in Australia's job ads signals a looming recovery in the nation's labour market. Nevertheless, as the unemployment rate stays near the highest level in a decade, there remains a substantial amount of slack in the market to be picked up. The ANZ Job Advertising Series showed job ads rose 1.8% last month from November, marking the seventh straight month that advertising was higher on a monthly basis. However, Australia's jobless rate was at 6.3% in November, just shy of the highest rate seen in 12 years.
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