The Reserve Bank of Australia's (RBA) February board meeting is shaping up to be a knife-edge decision, with forecasters divided on whether a cash rate cut is imminent.
ANZ joined the 'cut' camp last week, predicting the RBA will announce a 25 basis point reduction on 18 February, bringing the cash rate down from its 13-year high of 4.35% to 4.10%.
However, those hopes may have been tempered by the latest unemployment data, released on Thursday.
The employment market somewhat strengthened in December, with 56,000 new jobs created, according to Australian Bureau of Statistics (ABS) data.
Since inflation and unemployment often move in opposite directions, a continuously strong job market could signal persistent inflation.
Whatever the RBA decides, February's meeting will undoubtedly be a closely watched and highly scrutinised event.
Now, let's dive into this week's rate changes, where we saw some standout moves from mutual banks offering near market-leading rates.
G&C Mutual Bank slashes two-year fixed rate to 5.5% p.a.
First off the rank this week is G&C Mutual and its shiny new two-year fixed rate of 5.50% p.a. (5.56% p.a. comparison rate*).
That's 25 basis points lower than it was previously and among the lowest fixed rates on offer right now.
While bested by some of Bank Australia's fixed green home loan rates, and headline rate is approximately matched by offers from other customer-owned lenders, that comparison rate is notably competitive.
But therein might lie a catch.
While most fixed rates will simply revert to a variable rate on the expiry of a fixed rate period, G&C Mutual's product will revert to a new fixed rate period of the same duration.
Borrowers considering their product should beware of the repercussions of such a clause.
Capricornian cuts variable rates to as low as 5.89% p.a.
The Capricornian - the mutual bank dedicated to servicing an area spanning from Emerald to Yeppoon - has dropped its lowest variable rate on offer by 90 basis points to an eye-catching 5.89% p.a. (5.94% p.a. comparison rate*).
That rate is available for owner-occupiers turning to the bank's No Frills Home Loan product with loan-to-value ratios (LVRs) of 95% (or 97% for first home buyers).
For investors, the product's new rate is 6.09% p.a. (6.14% p.a. comparison rate*) with a maximum LVR of 90%.
And those weren't the only changes put forward by the regional institution, with fixed rates on its Premium Choice lineup also seeing a haircut.
The following rates are now available to borrowers with LVRs of 80% or less:
| Borrower | Fixed period |
New rate |
Comparison rate* |
|---|---|---|---|
| Owner-occupier | Two years | 5.59% (-15bp) |
6.60% |
| Three years | 6.09% (-38bp) |
6.64% | |
| Investor | Two years | 5.84% (-25bp) |
6.81% |
| Three years | 6.29% (-28bp) |
6.83% |
Australian Unity drops variable rates by up to 15 basis points
Finally, Australian Unity joined in on the cutting action this week, slashing variable rates for owner-occupiers.
The cuts were felt across all of its variable products.
New rates on its basic Kick Starter product and its Health Wealth and Happiness packaged product - which offers an offset account and discounted rates at the cost of a $399 annual fee - now as follows:
| Product | LVR | New rate |
Comparison rate* |
|---|---|---|---|
| Kick Starter | ≤70% | 6.03% (-15bp) |
6.03% |
| 70-80% | 6.08% (-15bp) |
6.08% | |
| Health Wealth Happiness Package |
≤70% | 6.04% (-14bp) |
6.39% |
| 70-80% | 6.09% (-15bp) |
6.44% |
Other movers
- Queensland Country Bank dropped fixed rates by up to 20 basis points
Advertisement
Lender Home Loan Interest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees Max LVR Lump Sum Repayment Additional Repayments Split Loan Option Tags Features Link Compare Promoted Product Disclosure
4.6 STAR CUSTOMER RATINGS
Promoted
Disclosure
Disclosure
Image by freepik
Share