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Banks slash rates for new customers – but will the RBA follow?
Lenders are continuing to price in a rate reduction from the Reserve Bank, according to new research.
Banks slash rates for new customers – but will the RBA follow?
Lenders are continuing to price in a rate reduction from the Reserve Bank, according to new research.
Results released by RateCity show that a total of 30 lenders have cut new customer rates this month ahead of Tuesday’s RBA meeting, but only for new customers or those willing to refinance.
Rate City research director Sally Tindall said there was increasing pressure on the banks to do the right thing, particularly as many lenders failed to pass on the last RBA cut to their variable customers.
“Governor [Philip] Lowe believes a rate cut now will help reduce the number of problem loans, but this will only work if the banks pass it on,” she said.
“Record-low rates have been a shot in the arm for the tens of thousands of mortgage-holders who have been able to refinance their loan during COVID.”
However, Mr Tindall pointed out that those who are “desperate” for a rate cut might not benefit if the RBA reduces the rate.
“At the same time, there are hundreds of thousands of Australians who haven’t been so lucky, forced to put their mortgages on hold as they struggle to stay afloat. These are the people who need a rate cut, now more than ever.
“Many people who have had to defer their mortgage or switch to interest-only repayments aren’t being offered the best rates from their lender,” Ms Tindall said.
“Banks should do the right thing by these customers by passing any RBA cut on to them as quickly as possible,” she said.
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