Customers wait to see if credit card rates go up

The major Australian banks may still raise credit cardinterest rates despite the Reserve Bank’s (RBA) decision to keep the official rate at its present level, a commentator has suggested.

Danny John, a finance writer for the Age, said that while there had been no mortgage rate hike today (February 2nd), industry observers would be closely watching credit card rates in the coming weeks.

He added that banks are more likely to raise rates on products such as business loans and credit cards that do not attract as much attention as home loans.

However, Mr John suggested that following the controversy generated by Westpac’s decision to raise home loan rates by 45 basis points in December – nearly double the official rate rise of 25 basis points – none of the major banks are likely to make rate rises of such a magnitude this time.

Loan Market Group executive chairman Sam White said that despite the RBA’s surprise decision to fix the country’s cash rate at its present level, the bank is likely to implement further rate rises in the coming year.

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