FINANCIAL MARKET SUMMARY

SELECTED FINANCIAL INSTRUMENTS

		Outstanding at end	Transactions during	Other changes during	Outstanding at end
		Dec Qtr 2016	Mar Qtr 2017	Mar Qtr 2017	Mar Qtr 2017
		$b	$b	$b	$b
Currency and deposits
	Currency	80.5	-2.8	-	77.7
	Transferable deposits	813.5	-3.7	-2.2	807.6
	Other deposits	1 582.8	15.7	-8.4	1 590.2
Short term debt securities
	Bills of exchange	55.0	-4.1	-	51.0
	One name paper	426.0	18.3	-2.1	442.2
Long term debt securities
	Bonds, etc.	2 373.2	9.4	-12.4	2 370.1
Derivatives
	Derivatives	555.1	-84.0	-37.1	434.0
Loans and placements
	Short term	340.3	-0.8	-2.2	337.3
	Long term	3 513.3	9.5	-7.0	3 515.7
Shares and other equity
	Listed	1 757.8	5.8	55.2	1 818.8
	Unlisted	3 067.6	15.5	32.5	3 115.6
Insurance technical reserves
	Reserves of pension funds and life offices	2 180.8	17.1	35.9	2 233.8
	General insurance prepayments and reserves	105.9	0.7	-	106.6
- nil or rounded to zero (including null cells)

Total deposits increased $1.4b in March quarter 2017 recording 21 consecutive quarters of growth, with net transactions of $12.0b and a valuation decrease of $10.6b. This is the lowest growth seen in total deposits since the negative growth in December quarter 2011. The increase in total deposits was driven by growth in other deposits which increased $7.4b during the quarter. The major drivers were the national general government ($14.0b) depositing into the central banks and households ($5.9b) depositing into banks in March quarter 2017. This was partially offset by a decline in other deposits by the rest of the world ($13.6b).

Bonds decreased $3.1b, with net transactions of $9.4b and revaluations of -$12.4b in March quarter 2017. Net transactions were driven by issuances in the domestic market, with national general government issuing $17.0b during the quarter. Issuance in the domestic market were offset by net maturity of $11.6b in the offshore market. Revaluations were mainly observed in the offshore markets, driven mostly by the increase in Australian dollar against the majority of major currencies over the quarter, with banks (-$9.3b) and other private non-financial corporations (-$5.6b) bond revaluations.

The loan market was flat with net transactions of $8.7b, offset by revaluations of -$9.2b. Net transactions during March quarter 2017 were driven by long term loans, with continued household borrowing from banks of $24.9b. This increase was offset by a fall in bank lending to the rest of the world of $14.8b.

The listed share market increased 3.5% in March quarter 2017, with net transactions of $5.8b and a valuation increase of $55.2b. Other private non-financial corporations and bank shares recording the largest valuation increases with $27.7b and $27.4b respectively, marking four consecutive quarter valuation increases for other private non-financial corporations.