Home loan holders copping interest rate carnage with June RBA hike

Reserve Bank of Australia Martin Place

In a call almost no leading economists predicted, the Reserve Bank of Australia doubled down its tightening bias today with another rate rise. The decision adds 25 basis points to official interest rates, pushing the cash rate to a decade-high of 4.10%. 

In his post-meeting statement, RBA governor Philip Lowe emphasised that despite a lack of meaningful data, he is determined to tighten the hold on inflation.

“Inflation in Australia has passed its peak, but at 7 per cent is still too high and it will be some time yet before it is back in the target range,” explained Lowe. 

“This further increase in interest rates is to provide greater confidence that inflation will return to target within a reasonable timeframe.”

Indeed, while many economists at Australia’s major banks have estimated the cash rate would eclipse 4%, they didn’t expect the decision to come until July or August. The RBA has repeatedly demonstrated that if it can lean hawkish with monetary policy, it will. 

Today’s decision will also remind home loan borrowers that now is the time to cut back and economise – not spend. 

“The combination of higher interest rates and cost-of-living pressures is leading to a substantial slowing in household spending,” says Lowe.

“Housing prices are rising again and some households have substantial savings buffers, although others are experiencing a painful squeeze on their finances.”

RBA meeting minutes released later this month will likely go out of their way to justify today’s decision. Westpac made this criticism after last month’s surprise rate hike: everything seems obvious in hindsight, after all. Interest rate decisions that are won only by a slim majority must seem like inevitable conclusions. In reality, the RBA treads an incredibly narrow path. 

RELATED: How high will rates go?

The post-meeting statement reiterates this narrow path the RBA must navigate to achieve a ‘soft landing’, i.e. bring inflation down without plunging Australia into a recession. Little is certain, and the bank must make decisions reactive to the economic climate. 

But given the RBA had previously promised rates wouldn’t rise until 2024, it behoves us to remember that neither Philip Lowe nor the rest of the RBA Board can see the future. They fly just as blindly as everyone else, albeit with wealth and economics degrees in their back pockets.


Which banks have increased rates?

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We’ll track which lenders have changed interest rates as word comes in. To see how your lender compares, visit our home loan comparison page.

Home Loan Old rate New rate Effective date Rate change Naughty or Nice
6.64 6.89 9 Jun 2023 0.25
ANZ Index Variable Rate (Owner Occupier, Principal & Interest)
8.14 8.39 16 Jun 2023 0.25
5.89 6.14 9 Jun 2023 0.25
6.74 6.99 13 Jun 2023 0.25
5.95 6.2 22 Jun 2023 0.25
7.74 7.99 16 Jun 2023 0.25
8.5 8.75 16 Jun 2023 0.25
8.53 8.78 20 Jun 2023 0.25
8.2 8.45 20 Jun 2023 0.25
8.3 8.55 16 Jun 2023 0.25
6.54 6.79 15 Jun 2023 0.25
7.36 7.61 16 Jun 2023 0.25
8.24 8.49 22 Jun 2023 0.25
5.74 5.99 26 Jun 2023 0.25
8.46 8.71 20 Jun 2023 0.25
6.24 6.49 14 Jun 2023 0.25
loans.com.au Smart Home Loan 90 (Owner Occupier, Principal & Interest)
6.54 6.79 9 Jun 2023 0.25
6.71 6.96 23 Jun 2023 0.25
8.36 8.61 18 Jun 2023 0.25
8.27 8.52 16 Jun 2023 0.25
8.0 8.25 16 Jun 2023 0.25
8.36 8.61 20 Jun 2023 0.25
8.61 8.86 20 Jun 2023 0.25
8.73 8.98 16 Jun 2023 0.25
6.44 6.69 15 Jun 2023 0.25
8.33 8.58 20 Jun 2023 0.25

Read last month's Reserve Bank interest rates update.

Home loan comparisons on Mozo

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Last updated 21 July 2024 Important disclosures and comparison rate warning*
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    Lock in a competitive interest rate and enjoy peace of mind for the fixed period. Available for owner occupied new and refinanced home loans with at least 20% deposit. Split option available as well as offset and redraw. Noapplication, ongoing or banking fees. Third Party fees may be applicable - payable within loan repayments. Extra repayments up to $20K per annum permitted. Apply online, 100% member owned credit union.

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    $3,027
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    Refinancers or first home buyers pay no monthly or annual fees. Flexibility to choose your repayment schedule (weekly, fortnightly or monthly). Redraw facility available. Split your home loan into multiple loan accounts.

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    Initial monthly repayment
    $3,043
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    Enjoy a low rate home loan with $0 application fee and $0 ongoing fees. Flexibility to split your loan and set different repayment types. Fee free redraw from your loan using online banking. Flexible ways to repay. 40% Deposit required.

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    6.14 % p.a.
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    6.39 % p.a.
    Initial monthly repayment
    $3,043
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    Ability to open up to 10 offset accounts per loan account. Fast online application. Linked Debit Mastercard® with fee-free access at ATMs across Australia. Package a credit card with your home loan and the annual card fee will be waived (T&Cs apply). 40% deposit required.

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** 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.

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