No notable hikes in fixed rates despite latest inflation rise
The mortgage market experienced minimal movement in interest rates this week, with no notable hikes in fixed rates, according to the latest data from RateCity.
Horizon Bank made the most significant change, lowering its lowest two-year fixed rate to 5.69%, just five basis points (bps) above the lowest two-year rate currently available in the market.
ME Bank also made a minor adjustment, reducing its lowest variable rate by 4bps to 6.13%.
Sally Tindall (pictured above), research director at RateCity, noted that although modest, the ME Bank reduction highlights the competitive nature of the mortgage market for new customers within the price range.
Among the big four banks, Commonwealth Bank of Australia (CBA), Westpac, National Australia Bank (NAB), and ANZ have their lowest advertised variable rates ranging from 6.13% to 6.79%. Fixed rates among these banks vary, with one-year fixed rates between 6.59% and 6.69%, and five-year fixed rates ranging from 6.69% to 6.84%.
Outside the big four, Abal Bank currently offers the lowest advertised variable rate at 5.75%, followed closely by G&C Mutual Bank at 5.80%. For fixed terms, The Capricornian offers the lowest one-year fixed rate at 5.74%, while RACQ provides a five-year fixed rate at 5.59%.
“CPI data out from the ABS on Wednesday shows Australia’s annual inflation rate has risen from 3.6% to 3.8% in the June 2024 quarter,” Tindall said. “While CPI is now officially moving in the wrong direction, the trimmed mean inflation results continued to drop, an important tick in the RBA’s books.
“These results, which were more or less as the RBA and economists expected, rule out the possibility of a cash rate hike next week, however, we’re not in the clear entirely just yet. The RBA is likely to reiterate its unwillingness to rule anything in or out at the next meeting – a phrase we expect to hear in the months ahead, potentially through to the end of the year.”
Want to be regularly updated with mortgage news and features? Get exclusive interviews, breaking news, and industry events in your inbox – subscribe to our FREE daily newsletter. You can also follow us on Facebook, X (formerly Twitter), and LinkedIn.
