Press Release

For immediate release

Information verified correct on December 12th, 2016

RBA holds cash rate but no relief in sight for borrowers

  • 80% of experts in finder.com.au Reserve Bank Survey predicted cash rate would hold
  • Nine lenders including big 4 banks have announced rate hikes in the past 3 weeks
  • Borrowers urged to keep on top of their lender’s rates and compare!

November 3, 2015, Sydney, Australia – Although the Reserve Bank held the cash rate at 2.00 percent today, for the first time this doesn’t spell relief for borrowers with a variable rate home loan as out-of-cycle rate increases will take effect later this month, according to one of Australia’s biggest comparison websites, finder.com.au.

While a cash rate pause would usually mean mortgage repayments remain steady, a recent rush of lenders announcing rate hikes means borrowers can expect to pay an extra $32 per month on a $300,000 loan later this month.

Since Westpac’s announcement last month (October 14, 2015), we’ve seen an additional eight banks follow by announcing rate rises. The latest is AMP and Suncorp Bank, which yesterday (November 2, 2015) announced variable rate increases to both owner-occupied and investment home loans of 0.18 and 0.16 percentage points respectively.

Today’s RBA decision comes as no surprise, as four out of five (80 percent) of leading economists and experts in the finder.com.au Reserve Bank Survey expected the cash rate to hold at 2.00 percent today.

According to Michelle Hutchison, Money Expert at finder.com.au, the majority had said an immediate cash rate cut to offset Westpac and other banks’ rate hikes was unlikely, while the property market’s recent cooling was too soon to lead to a rate change.

“Three experts, or 10 percent of those surveyed, believe a rate drop is around the corner though, citing December as the month this will happen. One in four experts are predicting the cash rate to rise in the fourth quarter of 2016, and 53 percent of experts tipping it will rise beyond 2016.

“In the meantime, it’s safe to assume more lenders will continue to raise their rates, following the lead of the big four banks, who all announced rate rises last month.

“With rate rises coming into effect later this month, impacting the majority of homeowners in Australia, borrowers have to keep on top of their provider’s rates, by reading the fine print and asking questions regarding their loan. In a time of uncertainty and change, and with Christmas just over seven weeks away, you don’t want to overlook the fine details – even a small increase to your interest rate can cost you hundreds, or thousands, of dollars per year,” she says.

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Disclaimer

The information in this release is accurate as of the date published, but rates, fees and other product features may have changed. Please see updated product information on finder.com.au's review pages for the current correct values.

About finder.com.au:

finder.com.au is one of Australia’s biggest comparison websites and has helped over 4.8 million Australians find better credit cards, home loans, life insurance, shopping deals and more since 2006. finder.com.au compares 250 credit and debit cards from 31 providers, over 300 home loan products, and information from 13 life insurance providers as well as online shopping promo codes, mobile phone plans, travel insurance and more. One Australian every five minutes is using finder.com.au or creditcardfinder.com.au to find better (Source: Google Analytics).

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