Australian Lending to Private Sector Unexpectedly Fell in May

Australia’s [B]Private Sector Credit[/B] unexpectedly shrank in May, falling -0.1% versus forecasts of a 0.2% expansion. The annual pace of credit growth fell to 3.9%, the lowest in over 15 years. Loans to businesses fell -0.7%, the most since December 2008, hinting that companies are delaying expansion plans and suggesting that unemployment will remain a concern in the months ahead. Indeed, a survey of economists conducted by Bloomberg calls for the jobless rate to hit 5.9% this year and top 7% in 2010.