Dec. 4 (Bloomberg) -- Australian home-building approvals declined more than economists forecast in October, led by a slump in apartment projects, sending the currency lower.
The number of permits granted to build or renovate houses and apartments dropped 7.6 percent from September, when they rose a revised 9.5 percent, the Bureau of Statistics said in Sydney today. The result compares with the median forecast for a 1.6 percent fall in a Bloomberg survey of 22 economists.
The Reserve Bank of Australia lowered borrowing costs five times from November 2011 to October to buttress the economy as a resource investment boom is predicted to peak at a lower level next year. Governor Glenn Stevens is trying to revive industries including construction to rebalance economic growth and extend 21 recession-free years.
“While we note that building approvals tend to lag monetary stimulus by a couple of quarters, the risk remains that residential construction does not lift sufficiently to offset a slowing in mining investment growth in the coming year,” said Celeste Tay, a Singapore-based economist at 4cast Ltd.
Building approvals in October advanced 14.5 percent from a year earlier, the report showed. That compares with economists’ forecast for a 20.2 percent rise year-over-year.
Approvals to build private houses fell 1.5 percent to 7,451 in October from the previous month, the report showed. Approvals for apartments and renovations declined 18 percent to 4,817.
The local dollar weakened, buying $1.0422 at 12:21 p.m. in Sydney from $1.0430 before the release. Traders are pricing in a 92 percent chance the RBA board will lower the benchmark when it meets today. The decision is due to be announced at 2:30 p.m.
Home-loan growth held in October at the slowest annual pace since at least 1977, a central bank report showed last week. Wage growth also slowed to the weakest pace in a year in the third quarter, government data showed last month.
Australian help-wanted notices fell for an eighth straight month in November, sliding 2.9 percent, an Australia & New Zealand Banking Group Ltd. report showed this week. Australian retail sales also stagnated in October, ending two months of advances, as consumers spent less on household goods, government data showed yesterday.
Separate government data today showed Australia’s current-account deficit widened more than economists forecast in the three months through September on weaker prices for iron ore and coal, the nation’s two biggest commodity exports.
The shortfall on goods, services and investment was A$14.9 billion ($15.5 billion) from a revised A$12.4 billion in the second quarter. The median estimate in a Bloomberg News survey of 24 economists was for a A$14.6 billion gap. Net exports added 0.1 percentage point to gross domestic product growth in the third quarter, the statistics bureau said today.
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