In the latest update from Canstar, Credit Union SA has raised two of its variable rates for both owner-occupiers and investors by an average of 0.18%, marking a week without any variable rate reductions.
On the flip side, Horizon Bank took a different approach, reducing 12 fixed rates for owner-occupiers and investors by an average of 0.25%, with no fixed rate hikes reported.
See table below for the rate adjustments over the past week.
Following last week’s rate adjustments, the average variable interest rate for owner occupiers paying principal and interest stands at 6.90% for loans with an 80% LVR. Meanwhile, Australian Mutual Bank boasts the lowest variable rate at 5.69% (intro rate), regardless of LVR.
According to Canstar's database, there are now 22 rates below 5.75%, an increase from 20 the previous week. The low rates are available at Australian Mutual Bank, HSBC, LCU, People’s Choice, Police Credit Union, RACQ Bank, and Regional Australia Bank.
See table below for the lowest variable rates at Canstar’s database.
Steve Mickenbecker (pictured above), Canstar’s finance expert, shed light on the future of interest rates following the Reserve Bank’s decision to maintain the cash rate at 4.35%.
“With the Reserve Bank decision at its March meeting to sit tight on a 4.35% cash rate, all of the speculation is now about when, not if, the cut will come,” Mickenbecker said.
He also highlighted that the average fixed home loan rates for owner-occupied borrowers are now around 0.5% below the average variable rate, signaling an expected downturn in interest rates.
Mickenbecker said that the timing of a cash rate cut hinges on upcoming economic data, with the monthly Consumer Price Index (CPI) and retail sales figures serving as critical indicators of the economy’s direction.
“The Reserve Bank is likely to wait on two favourable quarterly CPI numbers, for the June and September quarters, before cutting the cash rate, and this week’s releases will indicate whether the economy is on track for that,” he said.
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