Prudential curbs on lending are working – RBA report

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Prudential measures imposed to cool the housing market have succeeded in strengthening lending standards, the Reserve Bank of Australia says.

“Concerns about riskier types of new housing borrowing have eased,” the central bank says in its latest financial stability report. “The regulatory limits on investor loans and interest-only lending have reduced the build-up of macro-financial concerns.”

The RBA notes the transition from interest-only to interest-and-principal mortgages has increased

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