Total credit provided to the private sector by financial intermediaries rose by 0.2 per cent over June 2010, following an increase of 0.5 percent over May, the Reserve Bank of Australia said in a statement.

Over the year to June, total credit rose by 2.8 percent.

Housing credit increased by 0.4 percent over June, following an increase of 0.6 percent over May. Over the year to June, housing credit rose by 8.2 per cent. Housing credit rose over June due to growth in lending to both owner-occupiers and investors.

Other personal credit fell by 0.3 percent over June, following a fall of 0.4 percent over May. Over the year to June, other personal credit increased by 3.1 per cent.

Business credit was flat over June, following a rise of 0.4 percent over May. Over the year to June, business credit declined by 5.0 percent.

Over the month of June, M3 rose by 0.4 percent and broad money increased by 0.6 per cent. Over the year to June, broad money grew by 2.9 percent.

Bond futures

Australian bond futures advanced after the central bank said lending rose 0.2 percent in June, the least since November.

The 10-year contract for September delivery climbed to 94.790 on the Sydney Futures Exchange from 94.755 yesterday. The implied yield slid 3.5 basis points to 5.21 percent.

New Zealand's two-year swap rate dropped five basis points to 3.97 percent, the lowest since September. The rate, a fixed payment made to receive floating rates, is sensitive to central bank monetary policy.