The cost of living might be rising but Australians still have a good chunk of cash stashed away for a rainy day, according to new data.
New figures from The Australian Prudential Regulation Authority (APRA) revealed Australians stashed more than $8.2 billion in the bank in just one month as they prepared for the likelihood of interest rates staying higher for longer.
The total amount of household deposits is now sitting at $1.47 trillion, almost $200 billion more than before the start of the cash rate hikes in 2022.
RateCity.com.au research director, Sally Tindall, said Australians were building up savings buffers.
“Household deposits continue to defy gravity as Australians remain focused on building their war chests,” Ms Tindal said.
“The rate hikes might be exerting extreme pressure on many household budgets across the country, but those that can are putting a priority on saving every spare dollar they have in the bank.”
She said ABS data suggested Australians would rather save than spend at the moment.
“Retail trade figures for March posted a 0.4 per cent drop from the previous month, in another sign Australians are reassessing every dollar they spend,” she said.
“With a cloud of doubt forming around the prospect of any rate relief in 2024, things could still get tougher before they get easier.
“That’s a message that’s not been lost on many Australians.”
While savings are rising, so are the value of home loans.
The total value of housing loans to households – which includes both owner-occupied and investor loans – increased by more than $8.50 billion, or 0.4 per cent this month, with all four big banks recording growth in their loan books.
Westpac was the strongest of the big four banks, both in percentage and dollar terms, with a $2.33 billion increase to its loan book, equalling a 0.5 per cent increase, from the previous month.
CBA continued to make a steady comeback this month, with a $1.85 billion increase from the previous month – the strongest growth since June 2023, after the bank posted three months of negative growth in the second half of last year.
As a result, the bank’s home lending book has grown annually by less, in dollar and percentage terms, than Westpac, NAB, ANZ and Macquarie.
Macquarie picked up the pace in home lending in March, posting a 0.7 per cent increase from the previous month.
This is an acceleration compared to the previous two months which recorded rises of just 0.1 per cent and 0.3 per cent, respectively.
Ms Tindall said Westpac posted the strongest growth in its home lending book this month as the bank continues to chase market share.
“The bank is one of a handful of lenders still offering a cash incentive to refinancers via its subsidiaries St George, Bank of Melbourne and Bank SA,” she said.
“This year, CBA has managed to regain the ground it lost in the second half of last year, however, looking at the growth in its home loan book over the last 12 months it still lags behind its key competitors.”
