Surprise, Surprise, Surprise – Interest Rates On Hold
Filed under: Home Loans, Interest Rates, Investment Loans, Low Doc Loans
The Reserve Bank of Australia announced that it is leaving interest rates on hold at 3.75%. In a surprise move that stunned most economists the RBA wants to see if the effects of earlier rate rises.
More to come…
Interest Rates Unchanged For June
The Reserve Bank of Australia (RBA) has left interest rates unchanged at 3%.
The RBA cited a stabilising of the world and Australian economy was the main reason for keeping rates on hold for the second straight month. Australian rates have more room to move downward if there is a relapse in the local and global economy.
Some economists still believe that the official cash rate will be at 2.5% by the end of 2009. We will have to see how global economic conditions fair for the remainder of the year.
Current Lender Specials
Filed under: Current Mortgage Specials, First Home Buyer, Home Loans, Interest Rates
Below are current specials offered by various lenders.
Commonwealth Bank – 3 Year Rate Saver – $0 loan service fee for new borrowing
Homeloans – $0 upfront for their Premium Full Doc Loan
St George Basic Variable – Low rate at 4.99%, no up front and ongoing fees for new customers only.
Westpac – .20% discount on all fixed rates under Premier Advanatge Package. Nil upfront fee for Flexi First Option Home Loan for first home buyers.
Interest Rates Tipped to Remain On Hold
The Reserve Bank of Australia will meet this week to discuss where interest rates for June.
Economists expect interest rates to remain on hold as signs of the global economy begin to steady, however, their is a bias for rates to be reduced later in the year.
Further rate reductions will depend on the outlook of global and local economic conditions. If it begins to worsen again then the Reserve Bank may reduce rates again. For now it is a wait and see approach.
The Reserve Bank will provide its outlook for Australia this week and this may indicate a hint where they see interest rates for the remainder of the year.
Reserve Bank Cuts Rates By 0.25%
Today the Reserve Bank of Australia cut official interest rates to 3.00%. The lowest in 50 years.
The question is will the banks also pass on the 0.25% reduction onto its customers. The banks are still citing that the cost of funding is high but no matter which way we look at it they will all follow each others lead and offer similar rates across the board.
None of the major banks can afford to discount their rates significantly more than the others as they risk being inundated with applications that they cannot service. So each lender will move cautiously to avoid stressing their systems.
I will keep you updated on which lenders pass on the 0.25% and publish them as they come in.
UPDATE: Lenders passing on the rate cut
CBA – 0.10%
NAB – Nil claim they cannot afford it
ANZ – 0.10%
More to come as they release their intentions to the market. I expect the other lenders to follow ANZ and CBA
Westpac – 0.10%
St George – 010%
Suncorp – 0.10%
ING – 0.10%