Economic conditions

Australian financial environment remains stable. The Australian economy is continuing to grow at a strong pace, with household and business balance sheets, overall, being in good shape. The share of households experiencing financial difficulties has increased over recent years, largely reflecting the much wider availability of credit over the past decade. Households are benefiting from strong income growth and low unemployment, with household wealth rising solidly recently. While there are some areas of stress, particularly in western Sydney, most households are reasonably positive about their personal finances. Business balance sheets also remain in good shape, with debt-servicing ratios rates remaining at low levels.