The moderation in building approvals over December was a little larger than market expectations centred on a fall of 0.5%(CBA (f): 0.0%). Approvals have been tracking at around record levels for the past three months. So, some pull-back fromthese elevated levels is not surprising. The lift in approvals over 2013 was focussed in the mutli-unit sector, particularly inthe four or more storey block buildings. House approvals have also been trending upwards slowly but fell modestly inDecember. Various leading indicators we track had been indicating higher levels of house approvals which alsounderpinned our above consensus forecast for approvals. We expect house approvals are likely to rise over the next fewmonths.
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Commonwealth Bank