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. 

Read last month's Reserve Bank interest rates update.

Top home loans - last updated 19 January 2022

Search promoted home loans below or do a full Mozo database search. Advertiser disclosure
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    Fast and efficient online application. Automatic discounts as loan is paid down. Free extra repayments and redraw facility. Zero fees. Min 40% deposit required. Winner of three Mozo Expert's Choice Awards for 2021.

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  • Variable Home Loan
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    1.99% p.a. variable
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    Same low variable rate for all. No upfront or ongoing fees. Approval in minutes not weeks with a fast digital application. 100% offset sub account with no account or redraw fees. Comes with a Visa debit card, mobile App, and digital wallet (Apple and Google Pay). Refinance only. 25% deposit or equity required.

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    1.99% p.a. variable
    2.02% p.a.

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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.

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