Aus macro

The housing finance data is swiftly reverting to trend, below, by value…

…and below, by number, excluding refinancing (which gives us a better read of demand, albeit a sadly far too short a time frame).

Mortgage rates looking like the below will tend to do that.

The above is where (about half) the bear case for banks comes from. New loans, in retreat, is a headwind to growth, especially if they undershoot, leading to outright revenue declines, as a opposed to a mere moderation in top line sales.

The other half of the bear argument of course comes from the prospect of rising bad and doubtful debt, if people are struggling, or falling behind, and subsequently defaulting, on their loans.

No call to action (although in the back of my mind I am referencing sectoral allocations in direct equity portfolios).

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