Economists have said that business has responded to the federal government's economic fiscal stimulus package due to an unexpected jump in commercial lending commitments although a definite trend has not yet emerged.
Australian Bureau of Statistics (ABS) data showed earlier this week, that the value of commercial lending commitments jumped by $5.187 billion or 20.5 per cent in March, in seasonally adjusted terms, to a five month high of $30.498 billion. The March figures compared with February's fall of 14.7 per cent to a seasonally adjusted $25.053 billion.
Craig James Commsec's chief equities economist said that in terms of commercial lending it was a bit choppy, and that we needed to see a couple more numbers like those to get confident.
It could be that the tax break for business to take on new equipment could be providing a boost in the current environment. The Federal Government announced a $2.7 billion small and general business tax break as part of their second, $42 billion government stimulus package in February.
Since March last year commercial lending commitments have fluctuated between growth and contraction but on trend terms had been flat. Forecast economist Michael Turner said that it was the most volatile chart he had ever seen. He further stated that we had been presuming that business could not get access to credit or didn't want it now seems as though there was still some demand for business credit.
The March 2009 data showed that lease finance had risen 1.3 per cent in March to $469 million, compared with $463 million in February. The value of housing finance for owner occupation rose 7.3 per cent to $15.731 billion in March from $14.656 billion in February.
Mr. Turner further stated that the drop in personal finance was because people had been getting out of margin accounts for the last couple of years.
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