The latest weekly interest rate wrap from Canstar showed mixed changes in fixed home loan rates, with potential Reserve Bank cuts delayed until mid-2024 amid economic and political uncertainties.
Two lenders increased 39 fixed rates for both owner-occupiers and investors by an average of 0.10%, while three other lenders reduced 79 fixed rates by an average of 0.13%.
See which lenders moved in the table below.
The average variable interest rate for owner-occupiers on principal and interest repayments stands at 6.83%, with the lowest variable rate available at 5.75%, offered by Abal Banking.
Canstar’s database includes 232 rates under 5.75%, although no lenders adjusted variable rates in the past week.
For the list of lenders offering rates under 5.75%, see the table below.
“Just five lenders changed fixed mortgage rates this week, while there were no changes to variable rates, in a week that made history elsewhere,” said Sally Tindall (pictured above), Canstar’s data insights director.
Despite the US Federal Reserve’s recent 0.25% rate cut, the Reserve Bank (RBA) remains in a “wait-and-see” stance, holding the cash rate steady at 4.35% for a full year.
Tindall noted that, while it’s unlikely we’ll see rate cuts in Australia in early 2024, “the governor did confirm that the underlying inflation rate does not have to be in the target band before the board starts cutting.”
The possibility of cash rate cuts may open after the February inflation data, with May as a more probable target.
Tindall highlighted that factors like Donald Trump’s potential re-election could influence the Australian economy and interest rate trends.
“It’s way too early to make a definitive call on what impact the new president’s policies might have on Australian interest rates,” she said.
The Canstar leader advises borrowers not to rely on anticipated rate cuts until they actually appear in their accounts.
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