ANZ, NAB hike fixed rates while cash rate stays on hold

The Reserve Bank of Australia (RBA) left the cash rate untouched, which was widely expected, but there was no stopping the rate hikes rolled out by several lenders last week, including the big players NAB and ANZ.

CreditorWatch chief economist Anneke Thompson noted of an imminent cash rate hike given the developments in inflation and labour conditions.

“Despite three consecutive quarters of inflation being on or above the top range of the official inflation target band, today’s interest rate decision comes as no surprise - it does, however, seem that inflation is here to stay, at least for the short term,” she said.

On the labour front, Australia’s employment growth has been a “shining light” for the economy and is fueling wage growth forecasts.

“With this in mind, an interest rate rise appears imminent, but the velocity and speed of increases are still very uncertain,” Ms Thompson said.

“While inflation is a key target for the RBA, full employment is another —having just reached full, or close to full employment, it’s highly unlikely the RBA will choose to threaten this status by raising the cash rate too quickly.”

PropTrack economist Paul Ryan shared similar insights, adding that the RBA is keenly watching that inflation expectations across the economy are not being driven higher by increases in the cost of living.

“Higher inflation increases the likelihood of higher interest rates later in the year, which will weigh on housing price growth” Mr Ryan said.

“The outlook for housing prices later in the year is one of a balance between higher mortgage rates and the higher income growth the RBA is looking to see before raising rates.”

Despite the widely expected hold on the cash rate this month, lenders are still adjusting their rates, particularly fixed ones. Here are some of the biggest changes over the past week:

NAB

NAB raised its fixed rates under its Tailored and Choice Package products by as much as 40bps. Here are some of the most substantial rate hikes:

NAB Loan Product	Change	New Advertised Rate	Comparison Rate
Tailored Fixed P&I 3 yrs	Up 40bps	4.09% p.a.	4.54% p.a.
Choice Package Tailored Fixed - P&I 2 yrs 150k+		3.49% p.a.	4.25% p.a.
Choice Package Inv Tailored Fixed - P&I 3 yrs 150k+	Up 30bps	4.09% p.a.	4.80% p.a.
Investment Tailored Fixed P&I 3 yrs		4.19% p.a.	5.00% p.a.

 

ANZ

ANZ increased its fixed rates for both residential and investment loans by up to 30bps. These are some of the changes:

ANZ Loan Product	Change	New Advertised Rate	Comparison Rate
Residential Fixed 3 yrs ≤80%	Up 30bps	3.89% p.a.	3.22% p.a.
Residential Fixed 5 yrs ≤80%		4.49% p.a	3.60% p.a.
Investment Fixed 3 yrs ≤80%		4.09% p.a.	3.72% p.a.
Investment Fixed 5 yrs ≤80%		4.59% p.a.	4.00% p.a.

 

Bendigo Bank

Bendigo Bank rolled out up to 70bps rate hikes in its Complete Home Loan product for both owner-occupiers and investors.

Bendigo Bank Loan Product	Change	New Advertised Rate	Comparison Rate
Complete Home Loan Fixed P&I 2 yrs	Up 70bps	3.99% p.a.	2.75% p.a.
Complete Home Loan Fixed P&I 5 yrs		4.79% p.a.	3.49% p.a.
Investment Complete Home Loan Fixed P&I 2 yrs		4.15% p.a.	2.95% p.a.
Investment Complete Home Loan Fixed P&I 5 yrs		4.99% p.a.	3.69% p.a.

 

Athena

Athena’s fixed rates increased by as much as 85bps over the past week, with investor rates getting the highest increases.

Athena Loan Product	Change	New Advertised Rate	Comparison Rate
Fixed P&I 3 yrs ≤60%	Up 80bps	4.69% p.a.	2.59% p.a.
Fixed P&I 2 yrs 70-80%		4.39% p.a.	2.34% p.a
Investor Fixed P&I 3 yrs ≤60%	Up 85bps	4.79% p.a.	2.84% p.a.
Investor Fixed P&I 3 yrs 60-70%		4.84% p.a.	2.86% p.a.

 

Adelaide Bank

Both owner-occupier and investor fixed rates under Adelaide Bank’s Smart Fix and Smart Saver products went up by as much as 70bps.

Adelaide Bank Loan Product	Change	New Advertised Rate	Comparison Rate
Investment SmartFix P&I 2 yrs	Up 70bps	3.89% p.a.	3.38% p.a.
SmartSaver Fixed P&I 2 yrs		3.69% p.a.	2.98% p.a.
SmartSaver Fixed P&I 4 yrs	Up 65bps	4.39% p.a.	3.36% p.a.
Investment SmartSaver Fixed P&I 3 yrs	Up 60bps	4.29% p.a.	3.36% p.a.

 

UBank

UBank made some of the biggest rate hikes among all lenders over the past week, rolling out a fixed-rate increase of up to 135bps.

UBank Loan Product	Change	New Advertised Rate	Comparison Rate
UHomeLoan Fixed IO 5 yrs	Up 135bps	5.19% p.a.	3.36% p.a.
UHomeLoan Fixed IO 3 yrs	Up 140bps	4.89% p.a.	2.82% p.a.
UHomeLoan Fixed P&I 3 yrs	Up 101bps	4.25% p.a.	2.65% p.a.
Inv UHomeLoan Fixed P&I 3 yrs	Up 110bps	4.49% p.a.	2.91% p.a.

 

86 400

86 400 rolled out the highest rate increase over the past week at 155bps, which applies to its fixed rate under the Investment Own Home Loan interest-only product. Here are some of the highlights from the lender:

86 400 Loan Product	Change	New Advertised Rate	Comparison Rate
Investment Own Home Loan Fixed IO 3 yrs	Up 155bps	4.89% p.a.	3.08% p.a.
Investment Own Home Loan Fixed P&I 3 yrs	Up 125bps	4.49% p.a.	3.09% p.a.
Own Home Loan Fixed P&I 3 yrs ≤80%	Up 101bps	4.25% p.a.	2.96% p.a
Own Home Loan Fixed P&I 5 yrs ≤80%	Up 86bps	4.55% p.a.	3.39% p.a.

 

ME

ME followed the fixed-rate hike trend while also raising variable rates for its owner-occupier loans under the Member Package Flexible Home Loan product. Interestingly, it reduced its investor variable rates under the same product.

ME Loan Product	Change	New Advertised Rate	Comparison Rate
Flexible Fixed P&I 5 yrs	Up 40bps	4.29% p.a.	4.32% p.a.
Flexible Fixed P&I 4 yrs	Up 35bps	4.04% p.a.	4.42% p.a.
Inv Flexible Fixed P&I 4 yrs		4.24% p.a.	5.08% p.a
Inv Flexible Fixed P&I 5 yrs		4.39% p.a.	4.81% p.a.
Member Package Flexible Home Loan P&I 50-60% 400-699k	Up 6bps	2.09% p.a.	2.56% p.a.
Member Package Inv Flexible Home Loan P&I <50% 400-699k	Down 44bps	2.54% p.a.	300% p.a.