RBA keeps cash rate on hold but lenders are still changing rates
While the RBA may have kept rates unchanged, lenders are still switching things up.
Yesterday, at its March board meeting, the RBA decided to keep the cash rate on hold for the seventh month in a row. Lenders, however, have shown that they're no longer waiting for a change from the RBA to make their own changes to interest rates.
Following the RBA’s announcement, Homeloans.com.au decreased its investor fixed rates by between 0.08% and 0.24% for its Optima products. Beyond Bank, on the other hand, had already told affiliates of an increase to its fixed rates of between 0.05% and 0.10%.
These changes weren’t all that surprising. 90% of experts in our monthly RBA survey predicted that lenders would continue out-of-cycle rate changes, a trend that began in November 2016. Already this year we have seen a total of 28 lenders make some sort of change to interest rates, including two of the Big Four banks.
When asked what they predict the RBA’s next move will be, most of our panel (68%) predicted that the RBA will push the cash rate up. However, 68% of those experts don't believe this change will happen until 2018 or later.
“The RBA will be forced to remain on the sidelines for at least another year. Can’t cut for fear of stoking the housing market bubble and can’t hike due to weak growth and inflation,” QIC chief economist Matthew Peter said.