The Reserve Bank of Australia Board has left the official cash rate at a steady 2.50%, for a record 11 consecutive months at the July meeting.
Governor Glenn Stevens said in a statement that financial conditions overall remain very accommodative. "Long-term interest rates and risk spreads remain low. Emerging market economies are once again receiving capital inflows. Volatility in many financial prices is currently unusually low. Markets appear to be attaching a very low probability to any rise in global interest rates over the period ahead."
The Central Bank’s decision comes after the continued weakening of the Australian retail sector and the compromise of consumer confidence post the 2014 Budget Announcement. An extended period of cash rate stability is expected, with rate changes predicted by economists sometime next year.
While interest rates remain steady in the home loan market, a few financial providers have passed rate cuts to customers.
ING Direct has restructured the pricing on its Mortgage Simplifier and Orange Advantage and rates now start from 4.83% and UBank has reduced its 3 year fixed rate by 16 basis points to a 4.72% fixed interest rate.
However, loans.com.au still has the lowest variable rate at 4.54%. The best fixed rate for 1 year goes to IMB’s 3.99%, 2 years is crowned upon Newcastle Permanent’s 4.49%, and 3 years is prized to ME Bank’s 4.69%.
Search Mozo’s home loan hub to compare and save.
While interest rates remain competitive for mortgagees, avid savers face tough times as savings interest rates remain low and some providers have made further cuts. NAB has slashed 10 basis points off its iSaver intro rate down to 4.00% for the first 4 months and RaboDirect has cut its Premium Saver ongoing bonus rate from 4.00% to 3.85%.
However, superior savings can still be found in the ME Bank Online Savings Account with a 4.60% intro rate for the first 5 months for accounts up to $250,000. Keep in mind, it has to be linked to an Everyday Transaction Account.
Discover other star performers in the savings world here.
Read our Last month Reserve Bank interest rates update
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