The growth of lending to businesses flatlined in April while personal loans retreated for the seventh month in a row and annual property credit plummeted to unprecedented lows, central bank statistics suggest.
The financial aggregates data released by the Reserve Bank of Australia on Friday showed overall private sector credit grew 0.2 per cent in April, below market expectations of a 0.3 per cent gain.
Credit for mortgages increased 0.3 per cent on the previous month, while credit to business was unchanged and personal credit fell 0.3 per cent.
The data indicated housing credit to owner-occupiers grew 0.4 per cent over the month, while loans to investors was flat for the fourth consecutive month.
Overall credit rose 3.7 per cent over the past year as housing credit grew 3.9 per cent - the slowest growth rate since records started in 1976 - and business credit gained 4.5 per cent while personal credit fell 2.8 per cent in the 12 months to April.
"It is remarkable that loans extended to buy homes are growing at the slowest pace for over 40 years," CommSec economist Craig James said, adding that low levels of inflation was likely one of the causes.
"The situation doesn't seem sustainable, reflecting an alignment of deflationary influences."
The slow pace of lending to property investors "is continuing to suggest ongoing weak conditions in the housing market despite more positive signs from auction clearance rates," St George economist Janu Chan said.
UBS analysts said the further contraction in personal credit - which measures households' borrowing for purchases other than property - during April was "a negative signal for retail sales".
