Credit card borrowing down as Aussies clear debts

Friday 27 February 2009

Article by Mozo

The number of people feeling brave enough to compare credit cards and take on new personal debt decreased during January, new figures from the Reserve Bank of Australia (RBA) show.

However, there was a slight rebound in overall lending during the month, indicating that people are not so averse to credit with lower interest rates such as home loans.

Speaking to AAP, NAB’s Capital senior economist said the home loan and credit card provider was expecting that home loan applications would continue to grow, although interest in credit cards is likely to wane further as Australians grow cautious of debt during the downturn.

He added that the new figures are “a piece of evidence that the RBA would think that the slowdown in credit growth has eased off”.

If this is the case, it may be likely that the RBA will go easy on interest rates at its next meeting on March 4th.

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