October RBA announcement: board keeps cash rate steady at 2%

As predicted  by Australian economists, the Reserve Bank of Australia has left the official cash rate on hold at 2% after today’s board meeting.

Slowing economic growth and the dipping Aussie dollar are some of the factors driving the RBA’s decision to keep the cash rate steady. Many financial analysts have also predicted that the cash rate is likely to remain untouched for the rest of the year.

Governor Glenn Stevens noted in a statement that, “Low interest rates are acting to support borrowing and spending. Credit is recording moderate growth overall, with growth in lending to the housing market broadly steady over recent months. Dwelling prices continue to rise strongly in Sydney and Melbourne, though trends have been more varied in a number of other cities. Regulatory measures are helping to contain risks that may arise from the housing market.”

He further added that: “In other asset markets, prices for commercial property have been supported by lower long-term interest rates, while equity prices have moved lower and been more volatile recently, in parallel with developments in global markets. The Australian dollar is adjusting to the significant declines in key commodity prices. The Board today judged that leaving the cash rate unchanged was appropriate at this meeting.”

Home loan movements

Gap between owner occupier and investor rates

To meet APRA’s requirements that banks reduce their investor loan books, lenders continued to widen the gap between owner occupier and investor rates in September. Last month saw a number of home loan lenders offering rates below 4.00% for owner occupiers making principal and interest repayments with an LVR of up to 80%.

With regard to variable rates, many lenders are offering owner occupiers a variable rate up to 3.99%. However, you will need to check what loan amounts and LVR these rates are available for.

On the other hand, 13 lenders introduced new rate premiums for investors, ranging between 20bp and 42bp over their rates for owner occupiers. These include Abode, Adelaide Bank, Auswide Bank, Bendigo Bank, Citibank, Credit Union SA, CUA, firstmac, HSBC (no longer accepting any new investment loans), loans.com.au, ME, People’s Choice Credit Union, and Suncorp.

Big 4 Banks

Some of the major bank variable rate changes in September include NAB’s rate cut on its Base Variable Home Loan from 4.28% to 4.15% for both owner occupiers and investors making principal and interest repayments. Westpac too slashed the rate on its Flexi First Home Loan by 43bp to 4.19% for owner occupiers and to 4.46% for investors. In addition, CBA is waiving the $600 application fee and the $8 monthly service fee on its 3 Year Economiser Special Loan for owner occupiers (at a variable rate of 4.19% for 3 years then 4.99%).

If you’re looking for better deals for your home loan and want to shop around for more competitive options, visit Mozo’s home loan database to kick off your comparison. You can also connect with our home loan negotiators about how to look for the best home loan deal.

Savings accounts to watch out for

September did not see many changes in terms of savings accounts but two of the Big 4 Banks did increase their short term introductory bonus rates. While ANZ added 20bp to the 3 month intro rate on its Online Savings Account, taking the rate to 3.30%, Westpac increased the intro rate on its eSaver by 6bp to 3.31%.

There are still a number of providers offering competitive savings account deals, with the best ongoing bonus rate offered by RAMS’ Saver at 3.60%, followed by ING Direct’s Savings Maximiser at 3.50% and UBank’s USaver with Ultra at 3.37%. The best introductory rate is RaboDirect’s 3.50% on its High Interest Saver, matched by the St.George group of brands’ Maxi Saver.

Want to stay tuned with all the great savings offers in the financial market? Head over to Mozo’s savings accounts hub to compare some of the best deals in the market and  supersize your savings.

Read last month's Reserve Bank interest rates update.

Top home loans - last updated 24 April 2024

Search promoted home loans below or do a full Mozo database search. Advertiser disclosure
  • Mozo Expert Choice Badge
    Express Home Loan

    Owner Occupier, Principal & Interest, LVR <90%

    interest rate
    comparison rate
    Initial monthly repayment
    6.01% p.a. variable
    6.14% p.a.

    Get fast online approval from the award-winning Bendigo Bank Express Home Loan. Multiple offset accounts and redraw available. 100% offset on variable rate loans and partial offset on fixed rate. Flexible repayment options. New home loans only.

  • Discounted Home Value Loan

    Owner Occupier, Principal & Interest, LVR 70-80%

    interest rate
    comparison rate
    Initial monthly repayment
    6.09% p.a. variable
    6.09% p.a.

    Enjoy competitive rates for owner occupiers. Enjoy unlimited free extra repayments. Flexibility to redraw additional payments for free. No ongoing monthly service fee. Settlement fee waived on new borrowings from $50,000 (T&Cs apply).

  • Basic Home Loan

    Fixed, Investment, Interest Only, LVR <70%

    interest rate
    comparison rate
    Initial monthly repayment
    6.49% p.a.
    fixed 2 years
    6.56% p.a.


* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

** Initial monthly repayment figures are estimates only, based on the advertised rate. You can change the loan amount and term in the input boxes at the top of this table. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

^See information about the Mozo Experts Choice Home Loan Awards

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.