Interest rates to stay at 1.50% into 2019 following December RBA meeting

Summer may be officially here and temperatures hotting up, but the official cash rate remains well and truly frozen following another rate hold by the Reserve Bank Board at the December meeting in Sydney this afternoon.

The latest decision marks a 26th straight meeting at which the RBA has kept rates steady at 1.50%, ensuring that they will now remain at record low levels until February 2019 at the earliest.

In his post-meeting statement, RBA Governor Philip Lowe commented on the positive performance of the Australian economy and encouraging unemployment figures which have hit a six year low, though he also highlighted some of the continuing pressures. 

"One continuing source of uncertainty is the outlook for household consumption. Growth in household income remains low, debt levels are high and some asset prices have declined. The drought has led to difficult conditions in parts of the farm sector," he said.

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According to Mozo Product Data Manager, Peter Marshall, the RBA may be encouraged by recent signalling from the U.S Federal Reserve.

“The Federal Reserve recently indicated that it was going to ease off on the rate hikes for the time being in order to see how the raises they’ve implemented so far impact the economy,” said Marshall.

“What that does is take some of the pressure off the RBA. The gap between American and Australian rates are not going to keep growing so money’s not going to be flooding out of the country any more than it has already.”

November Rate Wrap

Home Loans

Another month, another rate hold. But while the official cash rate may be steady as a rock, home loan rates have continued to move around as usual.

According to the Mozo database, while November was a relatively quiet month, variable home loan rates hikes continued to outweigh cuts - especially for owner occupiers. Among the more significant changes, NAB increased its Base Variable Rate Home Loan while online retailer Kogan entered the market with a suite of low rate offers.   

Here are some of the lowest variable home loan rates currently* in the Mozo database:

Low variable rate home loan offers*

Fixed rate home loans were a different story though with a number of offers, particularly those for investors, cut over the course of November.

AMP made a 58 basis point cut to its 2 year 3.75% Fixed Rate Loan (Professional Package) for owner occupiers, while Bank First made cuts to both its 2 and 3 year fixed rate deals for owner occupiers and investors.

Check out some of the lowest fixed home loan rates for different terms currently* in the Mozo database:

Low fixed rate home loan offers*

Savings Accounts and Term Deposits

November proved to be just as quiet when it came to savings accounts and term deposits, though prospective savers might take heart from a number of positive changes.

Chief among these was the introduction of the MOVE Bonus Saver account which offers an ongoing bonus rate of 2.90% for savers who are able to deposit at least $200 into the account each month without making any withdrawals. The account is currently the highest ongoing bonus savings rate in the Mozo database.

Bank First also got amongst the action - hiking it’s Bonus Saver rate from 2.30% to 2.80% which now makes it the equal third highest ongoing bonus savings rate in the Mozo database.

High ongoing savings account bonus offers*

  • 2.90% - MOVE Bank Bonus Saver (if you deposit at least $200 into the account and make no withdrawals during the month)
  • 2.87% - UBank USaver with Ultra Transaction Account (if you deposit at least $200 into the account or a linked Ultra Transaction Account each month)
  • 2.85% - ME Online Savings Account (if you make a weekly Tap & Go purchase using a linked ME Everyday Transaction Account buck Debit MasterCard)
  • 2.85% - Bank First Bonus Saver (if you deposit at least $1 into the account and make no withdrawls each month)
  • 2.80% - Australian Unity Active Saver (if you make a minimum deposit of $250 and no withdrawals each month)

When it came to term deposits, the main change throughout the month of December came in the form of a 35 basis point bump from Arab Bank Australia to its 12 month offer. The new rate of 3.00% now sits alone at the top of the Mozo database for that term.

Unfortunately for savers in general though, Marshall doesn’t believe that the changes are the start of a rate rise resurgence.

“These increases don’t really say anything about any ongoing trends as they’re more likely to be strategic moves by individual providers trying to grab a bit more of the market,” he said.  

High term deposit offers (based on a balance of $25,000)*

RELATED: Is it time to shake up your savings account before summer starts?

Wants to compare even more great home loan, savings accounts and term deposit offers? It’s easy. Head over to Mozo’s banking hub and use our handy comparison tables to compare products from a range of different Australian banks and providers.

*Rates accurate as of December 4, 2018. 

**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.

Top home loans - rates updated daily

Search promoted home loans below or do a full Mozo database search. Advertiser disclosure.
  • placeholder
    Mozo Experts Choice 2021
    Smart Booster Home Loan

    1 Year Discounted Variable Rate, Owner Occupier, Principal & Interest, <80% LVR

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    1.99% p.a.variable for 12 months and then 2.48% p.a. variable
    2.47% p.a.

    A super low introductory rate home loan with no monthly or ongoing fees. Unlimited free redraws and unlimited additional repayments to help you build your equity and own your home sooner. Multiple loan splits available. (Rates revert after introductory period ends). 20% minimum deposit required. Winner of two Mozo Expert's Choice Awards for 2021.

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    Fixed Rate Loan with Orange Advantage

    Owner Occupiers, Principal & Interest, LVR <80%

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    Initial monthly repayment
    2.04% p.a.
    fixed 3 years
    3.60% p.a.

    Know exactly what your repayments will be, and you can fix your rate for up to 5 years. No monthly, annual fee or transaction fees.

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  • placeholder
    UHomeLoan

    Owner Occupier, Principal & Interest

    interest rate
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    Initial monthly repayment
    1.85% p.a.
    fixed 3 years
    2.24% p.a.

    $0 fees and easy application. Choose between weekly, fortnightly or monthly repayments. 3 year fixed rates are for new Owner Occupier Principal & Interest loans.

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  • placeholder
    Mozo Experts Choice 2021
    Variable Home Loan Special

    Owner Occupier, Principal & Interest, LVR <70%

    interest rate
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    Initial monthly repayment
    2.09% p.a. variable
    2.12% p.a.

    Yard’s low-rate variable special home loan is packed with all features – unlimited additional repayments, free redraw, 100% offset account. Enjoy a simple online application. Special rate applies to home loan applications submitted by 31st May 2021. Low Cost Home Loan winner in the Mozo Expert's Choice Awards for 2021.

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    Mozo Experts Choice 2021
    Celebrate Variable Home Loan

    <60% LVR, Owner Occupier, Principal & Interest

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    Initial monthly repayment
    2.19% p.a. variable
    2.19% p.a.

    Fast and efficient online application. Automatic discounts as loan is paid off. Free extra repayments and redraw facility. Zero fees to consider. Min 40% deposit required. Winner of three Mozo Expert's Choice Awards for 2021.

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*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, loan amount and term entered. 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 Loans Awards

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