by Alan Thornhill
Australians are saving more – and that is pushing up both bank costs – and home loan rates.
Sounds strange, doesn’t it?
But Australians are not just saving more.
They are becoming smarter with their money.
They are placing more of it in term deposits, which pay relatively high interest rates.
That,¬† of course,¬† adds to bank costs.
These developments were behind the decision of Australia’s big four banks made¬† last month to raise the rates they charge on home loans, even though the Reserve Bank had left its marker rate on hold in February.
Critics have suggested the banks could have got the money they need, to lend to home owners, more cheaply.
They said this money was available, at low rates, on international markets.
But that’s not what happened.
Indeed figures the Australian Bureau of Statistics published today show that¬† deposits account for 54.3 per cent of bank liabilities, in the December quarter.
The Bureau said that was the, highest level since June 1996 .
See¬† Australian National Accounts: Financial Accounts (cat. no. 5232.0)
Alan Thornhill is a parliamentary press gallery journalist.
Private Briefing is updated daily with Australian personal finance news, analysis, and commentary.
Friday May 24
The Dow Jones Index fell 12.44 points to 15,294.70
Ford Australia says it will close its Australian manufacturing plants in October 2016. Some 1,200 jobs to go.
Hazel Hawke dies at 83
A British soldier is hacked to death in the London suburb of Woolwich, in an apparent terrorist attack
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|Aud To Usd||0.9688||N/A||N/A|
|Bhp Blt Fpo||34.360||-0.520||-1.49%|
|Anz Bank Fpo||27.680||-0.450||-1.60%|
|Cwlth Bank Fpo||68.770||-0.940||-1.35%|
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