AMP, BoQ & Bendigo Bank slash fixed rates as U.S. Fed cuts

Joining the Federal Reserve in taking cutting action were majors AMP Bank and Bendigo Bank – with the latter posting a fresh fixed rate of 5.54% p.a.

That's lower than the 5.59% p.a. three-to-five year fixed rate posted by HSBC last month, but still a way off the market's lowest – 4.99% p.a. on SWS Bank's special offer three-year fixed rate.

Australia woke on Thursday to learn that the U.S. central bank slashed its benchmark rate by 50 basis points, bringing its target range to 4.75%-5.00%.

That figure is still notably higher than the RBA's (apparent) peak cash rate of 4.35%.

So, when might it be Australia's turn for a cash rate cut? That's still anyone's guess.

CommBank updated its forecast on Thursday and now believes the first cut will come in December – one month later than its previous prediction and months ahead of the first cut predicted by Westpac, NAB, and ANZ. 

While no one can be sure when a downward rate move might come – not even the RBA – the prospect of a rate cut Down Under continues to push home loan interest rates in a southerly direction.

Here're the latest interest rate moves home loan holders and would-be borrowers should know about.

Bendigo Bank slashes fixed rates, bumps variable offering

Regional major Bendigo Bank slashed many of its fixed rate offerings this week, but its moves likely left a sour taste for borrowers hunting for a variable rate home loan.

The bank upped the variable rate on its Express home loan for owner-occupiers making principal and interest repayments by 8 basis points.

The new rate on the product is 6.09% p.a. (6.22% p.a. comparison rate*).

In better news for would-be borrowers, the advertised rates on the bank's one and two year fixed rate products for owner-occupiers making principal and interest repayments were dropped by 45 basis points.

Rates on both its basic Express home loan product and its Complete home loan offering, which comes with an offset account, saw the following cuts:

Fixed period	Product	Change	New rate	Comparison rate*
One year	Express	-45bp	5.84%	6.19%
	Complete	-45bp	5.84%	6.42%
Two years	Express	-45bp	5.54%	6.11%
	Complete	-45bp	5.54%	6.32%

Ubank also cuts fixed rates

NAB-backed ubank also dropped its one and two year fixed rates for owner-occupiers this week.

Its new advertised rates include:

Fixed period	Change	New rate	Comparison rate*
One year	-15bp	5.85%	5.94%
Two years	-30bp	5.55%	5.87%

AMP drops fixed rates for owners and investors

If you're after a longer fixed rate period, AMP's latest rate cuts might pique your interest.

The banking and financial services company dropped the fixed rates on its Professional Package home loan product by as much as 45 basis points.

The package comes with an offset account and demands an annual fee of $349.

Changes for owner-occupiers making principal and interest repayments include:

Fixed period	Change	New rate	Comparison rate*
One year	-25bp	5.94%	7.19%
Two years	-30bp	5.79%	7.04%
Three years	-20bp	5.79%	6.91%
Five years	-45bp	5.79%	6.69%

Meanwhile, changes for investors making principal and interest or interest only repayments include:

Fixed period	Repayment type	Change	New rate	Comparison rate*
One year	P&I	-25bp	6.09%	7.21%
	IO	-25bp	6.24%	7.22%
Two years	P&I	-20bp	5.89%	7.06%
	IO	-24bp	6.00%	7.07%
Three years	P&I	-25bp	5.84%	6.93%
	IO	-20bp	6.04%	6.98%
Five years	P&I	-35bp	5.99%	6.78%
	IO	-30bp	6.19%	6.86%

BoQ lowers fixed rates by up to 20 basis points

Finally, Bank of Queensland (BoQ) made a second home loan rate move in as many weeks.

After cutting some offerings to under 6.00% p.a. last week, the bank dropped its discounted fixed rates for owner-occupiers new to the bank with loan-to-value ratios (LVRs) of 80% or less to as low as 5.59% p.a.

This week's changes to the bank's discounted fixed rates are as follows:

Fixed term	Change	New rate	Comparison rate*
Two years	-20bp	5.59%	6.39%
Three years	-10bp	5.59%	6.29%
Four years	-10bp	5.89%	6.33%
Five years	-10bp	5.89%	6.29%

BoQ-backed ME Bank also dropped fixed rates on its Members Equity package product by up to 20 basis points this week, mirroring many of its parent company's moves.

Owner-occupiers signing on for a two or three year fixed rate period might be able to secure a rate of 5.59% p.a. from the digital bank (comparison rates* vary from 6.47% p.a. to 6.53% p.a.).

Meanwhile, investors fixing their rate for two or three years could now realise an interest rate of 5.79% p.a. from ME Bank – whether or not they're making principal and interest or interest only repayments (comparison rates* vary from 6.85% p.a. to 6.93% p.a.).

Other movers

• Bank of China dropped select fixed and variable rates by 10 basis points
• Horizon Bank lowered certain fixed rates by up to 10 basis points
• Community First Bank dropped some fixed rates by 20 basis points
• Summerland Bank lowered standard fixed rates  by up to 15 basis points 
• MyState Bank dropped select fixed and variable rates by up to 55 basis points

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_{Image by Alexander Grey on Unsplash}