The Reserve Bank of Australia (RBA) left rates at 2.5% in its September meeting. The rate has now been unchanged for 13 months, as the RBA found financial conditions remaining very accommodative with volatility staying low.
The RBA’s commentary suggested that they did not see interest rates going any lower even if the economy did slow down a little bit in the near future unless global conditions deteriorated dramatically. The RBA is still looking for business environment to spend to take over from the mining boom.
Given the immediate outlook, the official cash rate is expected to remain on hold for the rest of 2014 with rates now expected to go up slightly in 2015.
Official interest rates affect rates offered to lenders and borrowers. With official interest rates expected to remain unchanged in the period ahead, investor rates have basically remained unchanged. Below are the latest “best” rates available.
On the other side of the equation, lenders are fighting harder than ever to win over new customers, particularly for lending products like home loans and credit cards. Given that the borrowing rates are likely to remain unchanged in the near period, very competitive offers as still available in the market.
|Providers – Investors||6mths||1yr||3yr||5yr|
|Teachers Mutual Bank||3.70%||3.40%||3.90%||NA|
|Qantas Credit Union||3.65%||3.65%||4.15%||NA|
|Arab Bank of Australia||3.60%||3.60%||3.80%||4.40%|
|Loans.com.au||Dream Home Loan||4.54%|
|State Custodians||Peak Performance Offset||4.59%|
|Australian Unity||Professional Package||4.63%|
|CUA||Basic variable special||4.65%|
* The comparison rates for all home loans are based on secured credit of $150,000 and a term of 25 years.
WARNING: The comparison rate applies only to the example given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees and cost savings such as fee waivers are not included in the comparison rate but may influence the cost of the loan.
Nick Stratus, Solid Financial Advisers, 11 September 2014