The number of permits granted to build or renovate houses and apartments gained 7.4 percent from February, when they dropped a revised 8.8 percent, the Bureau of Statistics said in Sydney today. The result compares with the median forecast for a 3 percent gain in a Bloomberg News survey of 18 economists.
Reserve Bank of Australia Governor Glenn Stevens last week slashed the overnight cash rate target to a two-year low of 3.75 percent from 4.25 percent, the deepest reduction in three years, a decision forecast by two of 29 economists. The nation’s house prices declined in the three months through March in the longest losing streak in at least a decade. Stevens aims to buttress the housing market, support jobs and boost confidence.
“A likely reversal in last month’s large fall in apartment approvals and slightly better finance commitments should see a solid rebound in building approvals,” Paul Brennan, a senior economist at Citigroup Inc. said in a research report before the release.
Building approvals in March declined 15 percent from a year earlier, the report showed. That compares with economists’ forecast for an 18 percent drop year-over-year.
Approvals to build private houses rose 3.9 percent to 7,518 in March from the previous month, the report showed. Approvals for apartments and renovations advanced 15.5 percent to 3,815.
Traders are pricing in an 88 percent chance the central bank will lower borrowing costs by a quarter-percentage point to 3.5 percent at its meeting next month, swaps data compiled by Bloomberg show. The local dollar traded at $1.0129 at 11:44 a.m. in Sydney, near the lowest level of the year.
To contact the editor responsible for this story: Stephanie Phang at firstname.lastname@example.org