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Capital
®
Volume 25 Number 17
Capital Dynamics Sdn Bhd
8
Table 13: Bank Lending
Year-on-year % change
Amount Outstanding (trillion Yen)
Sep 2013
Oct 2013 Nov 2013
Nov 2013
Total
2.2
2.3
2.4
407.2
Major banks
1.9
1.7
1.8
198.6
Regional banks I
3.1
3.1
3.3
164.5
Regional banks II
0.9
1.9
2.0
44.1
Japan’s current account posted a deficit of 127.9 bln Yen in Oct, the first deficit in 9 months – see
table 14
. This was due mainly to a bigger deficit in the trade balance, which is likely to stay large in
the next few months due to high imports of fuel for the winter.
Table 14: Current Account Balance
(
100 mln Yen)
Oct 2013
Sep 2013
Oct 2012
Trade balance
-10,919
-8,748
-4,513
Exports
58,332
57,172
49,495
Imports
69,251
65,921
54,007
Services
-3,137
-1,015
-3,155
Income
13,615
16,279
12,483
Current transfers
-838
-643
-607
Current Account
-1,279
5,873
4,208
Money supply, M2, continued to rise at a record pace, up 4.3%, year-on-year, in Nov. The uptrend in
monetary expansion reflects the Abe government’s efforts to bring about a 2% inflation rate. As the
inflation rate still falls short of the target, the uptrend in monetary expansion should continue in the
months ahead.
Europe
The European Central Bank kept its benchmark interest rate 0.25%. Underlying price pressures are
expected to remain subdued over the medium term and the pace of economic recovery remains weak.
Hence, monetary policy should stay accommodative to support a stronger economic recovery.
Australia
The seasonally adjusted Performance of Construction Index (PCI) increased by 0.8 ppts in Nov to
55.2%. This was the second consecutive reading above the 50% critical value that separates
expansion from contraction and signals its strongest performance since Apr 2010.
The improvement largely reflected a sharp increase in new orders, particularly in the housing and
engineering sectors, along with a rise in deliveries from suppliers – see
table 15
. Although building
activity in the four major sectors moderated somewhat, capacity utilisation rate rose to its highest level
since Dec 2010. However, the rate of contraction in selling prices increased again despite rising cost
burdens, suggesting builders remain under significant pressure.
Survey respondents noted that demand was strengthening along with an increase in tender
opportunities. House builders reported that customer enquiries had been sustained at high levels.
However, tight credit conditions and a lack of public sector tenders were cited as the main constraints
on activity.
Table 15: PCI (%)
Sep 2013
Oct 2013
Nov 2013
Monthly Change(ppts)
Overall PCI
47.6
54.4
55.2
+0.8
Activity
51.9
57.3
54.6
-2.7
Houses
61.5
65.3
62.0
-3.3
Apartments
57.7
66.2
57.9
-8.3
Commercial
43.7
52.6
52.9
+0.3
Engineering
49.0
52.7
52.5
-0.2
New orders
50.8
54.3
58.5
+4.2
Employment
40.6
52.5
50.3
-2.2
Deliveries
44.4
52.0
57.9
+5.9
Input prices
67.3
72.1
71.3
-0.8
Selling prices
41.9
48.9
44.9
-4.0
Wages
55.2
57.4
55.7
-1.7
Capacity
67.6
70.8
72.0
+1.2
In Oct, the total value of housing finance commitments rose 4.1%, month-on-month, and 21.4%, year-
on-year. As shown in
table 16
, the rise largely reflected rising finance commitments for the purchase
of established dwellings and investment housing. Year-on-year, the total value of housing finance
commitments for both owner occupied and investment housing continued to surge, rising 17.2% and
28.8% respectively .