This is a round-up of rates in July and some may have changed since the time of writing. To check on today’s rate, click on the highlighted product.
With the RBA choosing to hold its position on rates in July there was little incentive for banks and lenders to adjust their rates. Although, as suggested in last month’s Rate Chasers blog, we did see a few strategic shifts.
Variable home loan rates were left largely untouched during July, but there has been a lot of movement in the fixed rate arena. The average 1 year fixed rate was down 6 basis points and the average 3 year fixed rate was down 9 basis points. This doesn’t sound like much, but some of the specific movements that contributed to those changes were quite large.
Looking at rates for a $300,000 loan, last month the best 1 year fixed rate was 5.68%., now it’s 5.54% with online lender My Mortgage Freedom. In fact, all of the top 5 one year fixed rates at the end of this month are lower than the best that was on offer four weeks ago.
Three year fixed home loan rates tell a similar story, but the best rate is a whole 21 basis points lower than last month. Again it’s My Mortgage Freedom’s with the same 5.54% interest rate for 3 years.
Credit card interest rates here have been quite static. The main change was CBA’s 25 basis point reductions in rates across all of its Commonwealth Bank credit cards. Previous months have seen similar cuts by ANZ and NAB, which just leaves Westpac as the only one of the Big 4 not to have passed on at least some of the cuts to credit card customers since the RBA started lowering the cash rate late last year.
While rates on at call savings accounts are still easing, some providers are still keen enough to compete for our savings. The Commonwealth Bank saw fit to cut the rates on both of its main savings products, but Westpac made a move in the opposite direction, increasing the 3 month introductory rate on its eSaver account to 5.1%. However, this is still far from one of the best rates available right now.
Of more interest to those with some money in the bank was UBank’s decision to pump its ongoing conditional rate up to 5.71% after drifting as low as 5.51% in recent times. This could be a reaction to RAMS holding its RAMS Saver rate at 5.75% as the new player seeks to establish itself as a price leader.
The trend in term deposits through July was for rates across most terms to ease slightly, however there are a few appealing rates for investments of 1 year – UBank now offer 5.31% and RaboDirect will pay 5.12%.
Some analysts have been calling for the Reserve Bank to cut the cash rate again when it meets in August on the back of some softening in key indicators, such as CPI and demand for business credit. There’s not an overwhelming case for another cut, but if they do we should see rates moving down again. So while fixed rate home loans are looking very attractive right now it may be worth holding off making a commitment to fix for a few more weeks to see if the downward movements continue.