The major news this week has been the downward trend of the Australian dollar which for the first time in 6 years fell below 0.5 GBP and reach monthly lows against the Yen, US dollar and Euro. Despite this decline in our currency the All Ordinaries bounced back from 2 days of decline and returned itself to trend after a rough few months earlier in the year.
This week also saw the release of some credit figures for April which show that while total credit growth is up 0.3%, it has primarily been driven by a 0.8% increase in housing credit rather than anything else. Business investment hasn’t budged and personal credit has in fact declined 0.1%. Despite the consensus that it takes 6 to 18 months for the effects of monetary policy to be felt in the economy it is definitely something the RBA will be thinking about this Tuesday.