RBA holds interest rates steady at 1.75% amidst global uncertainty

With global markets unsettled in the wake of Brexit and the Federal Election shaking up the domestic scene, the Reserve Bank of Australia has opted to keep interest rates on hold for now, at 1.75%.

The decision comes as no surprise, with 25 economists interviewed by Bloomberg unanimously predicting that this month’s RBA announcement would hold rates steady. However, most experts, with the notable exception of NAB, have forecast a rate cut for August.

In a statement, outgoing Governor Glenn Stevens said that, “In Australia, recent data suggest overall growth is continuing, despite a very large decline in business investment. Other areas of domestic demand, as well as exports, have been expanding at a pace at or above trend."

He added that "Financial institutions are in a position to lend and credit growth has been moderate. These factors are all assisting the economy to make the necessary economic adjustments, though an appreciating exchange rate could complicate this."

Whether or not an August interest rate drop actually happens may come down largely to both the new global market conditions as regulators navigate Brexit developments, and the June quarter consumer price inflation (CPI) report which will be released on July 27.

What does it mean for your home loan?

During the month we’ve seen the lingering effect of the last RBA rate cut on home loan interest rates, with further cuts - particularly on fixed rate home loans - trickling through from lenders. So for any home buyers considering locking in a low rate, now may be a good time to make a move - unless you’re betting on another RBA rate cut in August.

Although already low home loan rates are looking even sweeter, and seem unlikely to rise again in the next month or two, it’s not time for borrowers to become complacent. Savvy Aussies should still keep one eye on the market and stay up-to-date on the best home loan deals.

Best fixed rate home loan offers
  • 1 year fixed rate: Illawarra Credit Union - 3.65% (comparison rate 4.10%)
  • 2 year fixed rate: 3.74% -  Suncorp (comparison rate 4.45%), Newcastle Permanent (comparison rate 4.84%)
  • 3 year fixed rate: loans.com.au - 3.67% (comparison rate 3.88%)
  • 4 year fixed rate BCU - 3.80% (comparison rate 4.38%)
  • 5 year fixed rate: 3.99% - Greater Bank (comparison rate 4.48%), Teachers Mutual Bank (comparison rate 4.77%), UniBank (comparison rate 4.77%)

Best variable rate home loan offers

ProductVariable rate
FreedomLend Variable Home Loan3.73%
Newcastle Permanent Discounted Variable Home Loan (Premium Plus Package)3.74%
UBank UHomeLoan - Value Offer3.74%

*All home loan rates based on owner occupiers with an LVR of 80% or higher

Check out other great home loan offers on the market over at our home loan comparison table.

And what about your savings?

Although the RBA has opted to keep interest rates on hold for now, with experts predicting another cut on the horizon savers will need to be on the lookout for all the best deals in order to secure a decent return on their cash stash.

Luckily, Mozo are here to help, and we’ve rounded up some of the best high interest savings accounts to park your rainy day fund in.

Best savings accounts

ProductInterest rateSpecial conditions
ME Online Savings Account3.35%Make a weekly Tap & Go purchase with the debit card attached to your ME Everyday Transaction Account
CUA eSaver Reward3.15%Deposit $1,000 into a CUA transaction account in the month.
RAMS Saver Account3.15%Minimum deposit of $200 and no withdrawals in the month.
UBank USaver with Ultra Transaction Account3.12%Minimum deposit of $200 into either account in the month.
Bank Australia Bonus Saver3.00%Minimum deposit of $100 and no withdrawals in the month.

For more great savings options, visit our saving accounts comparison table. 

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

    interest rate
    comparison rate
    Initial monthly repayment
    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 Award for 2021.

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    Details
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    UHomeLoan

    Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    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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    Details
  • placeholder
    Mozo Experts Choice 2021
    Celebrate Variable Home Loan

    <60% LVR, Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    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 Award for 2021.

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    Details
  • placeholder
    Mozo Experts Choice 2021
    Variable Home Loan Special

    Owner Occupier, Principal & Interest, LVR <70%

    interest rate
    comparison rate
    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 Award for 2021.

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    Details
  • placeholder
    Basic Home Loan

    Fixed, Owner Occupier, Principal & Interest, LVR<70%

    interest rate
    comparison rate
    Initial monthly repayment
    2.09% p.a.
    fixed 3 years
    2.43% p.a.

    Get a flexible loan structure with up to six loan accounts with different rate types. Make free extra repayments. Enjoy free redraw facility. No upfront or ongoing fees. Option to earn Qantas points.

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    Details

*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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