July RBA decision: Official cash rate untouched at 1.50%

As Benjamin Franklin once wrote, "...in this world nothing can be said to be certain, except death and taxes,” but the old idiom could well be in need of updating, with the RBA board yet again showing their consistency by maintaining interest rates at a record low 1.50%.

The decision handed down in Sydney this afternoon marks a twenty-first straight hold from the RBA, which now hasn’t made a change to the official cash rate since a rate cut back in August 2016.

In his monetary policy decision statement RBA Governor, Philip Lowe, highlighted strong GDP growth in the March quarter, positive employment growth and low levels of inflation as factors that contributed towards the board's decision to hold. 

"The low level of interest rates is continuing to support the Australian economy. Further progress in reducing unemployment and having inflation return to target is expected, although this progress is likely to be gradual," he said. 

RELATED: Why home loan rates are going up

According to Mozo Product Data Manager, Peter Marshall, the latest hold from the RBA comes as no surprise given the state of the key economic indicators, with little prospect of any move in either direction in the near future.

“If we do get more rate increases from the banks and the economy’s strength continues to be below expectations, there’s potential that the RBA could cut interest rates to counterbalance some of those out-of-cycle increases. But that seems less likely than a long period with no change eventually followed by some increases,” he said. 

Mortgage rates are on the move (and heading north)  

While the latest RBA decision is hardly likely to raise any eyebrows, it does further highlight the widening gap between the official cash rate and rising variable home loan rates. Figures from the Mozo database show that six lenders have recently hiked variable home loan rates, or have signalled that they plan to do so in the near future. 

According to Marshall, the rate increases are in part down to the increased funding pressure Australian banks are facing as a result of rising interest rates in Europe and the United States, as well as an unusually high Bank Bill Swap Rate at home.

But while interest rate rises will be an unwelcome hit to some household budgets, there could be a larger problem for mortgage holders.

“I think the biggest area of concern is not interest rates, but credit availability. The banks have been tightening their credit assessment procedures which makes it harder for people to get loans or refinance,” said Marshall.

“There are a growing number of people who will find that they’re not able to shift from one lender to another, as well as those on interest only loans who will find that they are denied a further interest only period.”

Best variable rate home loan offers

Best fixed rate home loan offers (3 year term)

  • Easy Street Special 3 Year Fixed - 3.69% (comparison rate: 4.11%)
  • UBank UHomeloan Fixed - 3.74% (comparison rate: 4.01%)
  • Freedomlend Fixed Home Loan - 3.79% (comparison rate: 4.28%)
  • IMB Bank Fixed Home Loan - 3.79% (comparison rate: 4.76%)
  • Teachers Mutual Bank Fixed Option Home Loan - 3.79% (comparison rate: 4.99%)
  • UniBank Fixed Option Home Loan - 3.79% (comparison rate: 4.99%)

Term deposits ticking up

While the outlook won’t look so rosy for some homeowners, the continued uptick in term deposit rates could be good news for Australians looking to make a return on their savings.     

Figures from the Mozo database reveal that term deposit rate increases heavily outweighed decreases in the month of June, with offers in the 1-3 year term deposit categories now at their highest points since late last year.

On the other hand savings account rates remain relatively unchanged, with an increase to Citi’s four month introductory rate to 3.05% and a sprinkling of rate reductions among the changes over the past month.   

Read on below for some of the best term deposit and savings account offers currently* in the Mozo database:

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

Best ongoing savings account offers

  • RAMS Saver Account - 3.00% (if you deposit a at least $200 and make no withdrawals each month)
  • UBank USaver with Ultra Transaction Account - 2.87% (if you deposit a minimum $200 into the account or a linked Ultra Transaction Account each month)
  • ME Online Savings Account - 2.85% (if you make a weekly tap and go purchase using your linked ME Everyday Transaction Account Debit MasterCard)
  • Australian Unity Active Saver - 2.80% (if you make a minimum deposit of at least $250 and no withdrawals every month)
  • Coastline Credit Union Bonus Reward Saver - 2.80% (if you make a minimum deposit of $20 and make no withdrawals within the month)
  • ING Savings Maximiser - 2.80% (if you deposit $1,000 or more each month from a linked Orange Everyday account as well as make at least five purchases on your credit or debit card)

RELATED: New financial year sparks home loan discounting frenzy

Interested in comparing more great offers? Mozo’s handy home loan, term deposit and savings account comparison tables could help you land a better deal today. 

*Rates accurate as of July 3, 2018.

Read last month's Reserve Bank interest rates update.

Home loan comparisons on Mozo

Mozo may receive payment if you click the products below. We don’t compare the entire market, but you can search our database of 473 home loans.
Last updated 19 June 2024 Important disclosures and comparison rate warning*
  • Unloan Variable

    • Owner Occupier
    • LVR <80%
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    5.90 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply online in minutes.

  • Basic Home Loan

    • Owner Occupier
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.16 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    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.

  • Offset Home Loan

    • Owner Occupier
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.39 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    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.

  • Unloan Variable

    • Owner Occupier
    • LVR <80%
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    5.90 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply online in minutes.

  • Discount Variable Home Loan

    • Owner Occupier
    • LVR<70%
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    6.01 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    A low rate home loan for owner-occupiers packed with great features including unlimited extra repayments, free online redraw, no application or monthly admin fees. Rate will vary depending on LVR. Winner of a Mozo Experts Choice 2024 Low Cost Home Loan Award^

  • Variable Home Loan 90

    • Principal and Interest
    • LVR <90%
    Interest rate
    6.04 % p.a.
    Variable
    Comparison rate
    6.06 % p.a.
    Initial monthly repayment
    $3,011
    Go to site

    Affordable home loan rate for buyers or refinancers. No monthly or ongoing fees. Option to add an offset for 0.10%. Access to savings with unlimited redraws available. Minimum 10% deposit required.

  • Fixed Rate Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <80%
    Interest rate
    6.09 % p.a.
    Fixed 3 years
    Comparison rate
    6.15 % p.a.
    Initial monthly repayment
    $3,027

    Additional repayments of up to $10K per fixed year. Interest rate discounts available. Waiver of $499 application fee when combined with an Orange Advantage Home Loan.

  • The Better Home Loan Special Offer

    • Owner Occupier
    • Principal & Interest
    • LVR<80%
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.14 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    Enjoy a variable rate home loan with a bunch of features from Police Credit Union. Make extra repayments at any time without penalty. No monthly, annual or upfront fees. Free online redraw. Minimum 20% deposit. Qualifying criteria applies. Minimum loan amount is 200K. For new customers only. Mozo Experts Choice Home Lender Credit Union of the Year 2023.

  • Basic Home Loan

    • Owner Occupier
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.16 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    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.

  • Mortgage Simplifier

    • LVR<80%
    • Owner Occupier
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.17 % p.a.
    Initial monthly repayment
    $3,043

    Get a competitive variable rate with ING’s Mortgage Simplifier. Free extra repayments, no monthly or annual fees. Freedom to make free extra repayments or redraws.

  • Offset Home Loan

    • Owner Occupier
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.39 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    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.

  • Basic Home Loan

    • Fixed
    • Owner Occupier
    • Principal & Interest
    • LVR<70%
    Interest rate
    6.25 % p.a.
    Fixed 3 years
    Comparison rate
    6.20 % p.a.
    Initial monthly repayment
    $3,079
    Go to site

    No upfront or ongoing fees. Free extra repayments and redraw facility. Option to earn Qantas points. Min 30% deposit required. Borrow up to $750,000.

  • Fixed Rate

    • Owner Occupier
    • Principal & Interest
    • <80% LVR
    Interest rate
    6.59 % p.a.
    Fixed 3 years
    Comparison rate
    7.06 % p.a.
    Initial monthly repayment
    $3,190

    Enjoy up to $3000 cashback for eligible first home buyers and $2000 cashback for refinancers on eligible home loans with the ANZ Fixed Rate Home Loan. Get the security of repayment certainty with a competitive locked in rate. No ongoing fees to pay. Offset account on 1-year fixed loans ($10/month fee applies). Interest-only payments allowed.

image of houses

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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. 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.

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.