August RBA interest rate hold marks two years of stability

By Tom Watson · · 4 min read
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With today’s decision to leave the official cash rate on hold at 1.50% for a 24th consecutive month, the RBA’s affair with steady interest rates has well and truly eclipsed that (at least in terms of length) of most budding relationships.

High levels of household debt and uncertainty in the global economy continue to provide impediments to any action from the board, but RBA Governor, Philip Lowe, did highlight a positive trend in employment figures in his Monetary Policy statement.

"The outlook for the labour market remains positive. The vacancy rate is high and other forward-looking indicators continue to point to solid growth in employment," he said. 

"Employment growth continues to be faster than growth in the working-age population. A further gradual decline in the unemployment rate is expected over the next couple of years to around 5 per cent."

RELATED: Borrowers race to fix below 4.00%

According to Mozo Product Data Manager, Peter Marshall, while the status quo remains unlikely to change in the foreseeable future, the direction in which rates will move next isn’t so certain.   

“Depending on what happens in the broader economy, particularly globally, we shouldn’t discount the possibility of the next RBA rate move being a cut. It’s definitely not off the table,” he said.  

“The RBA is still preferring to make noises about rate increases, but that’s been toned down a lot over the last few months. We really just have to see how the next six months go, particularly with the United States and China trade situation and the impact it could have on Australia.”

Home loan rates and household debt

While the official cash rate has now remained at a steady 1.50% for two years, the same certainly hasn’t been true of late for variable home loan rates, with a host of lenders having made out-of-cycle rate increases since the start of June.

In fact, according to Mozo’s July Banking Roundup, 18 home loan lenders tracked in the Mozo database have hiked rates for the majority of their customers in the last two months.

And the recent hikes are unlikely to have helped households already struggling with high levels of debt, with recent figures released by global ratings agency, Moody’s indicating that Australia’s household debt as a share of disposable income has now reached 200% - one of the highest levels in the world.

So if you’re keen to ease the burden on your own household budget by refinancing to a better value home loan, here are some of lowest home loan rates currently* in the Mozo database:

Best variable rate home loan offers

Mixed news for savers

Last month we reported on the term deposit market maintaining it’s steady rise as banks compete for stable sources of funding. And while term deposit rate rises have continued to outweigh cuts, the Mozo database recorded more of the latter during the month of July than in previous months.

The most fervent action of late has centered upon 12 month term deposit rates, with both Teachers Mutual Bank and UniBank increasing their 12 month offers by 20 basis points to a market-leading 3.00%.

On the other side of the savings spectrum, the state of savings accounts rates can be summed up in five words: cuts, cuts and more cuts.   

The most serious pain for savers has remained in savings account base rates, as the Commonwealth Bank (30 basis point cut) and Westpac (30 basis point cut) joined a number of other banks in dropping their respective base rates during July.

Despite the cuts from some banks, the most competitive ongoing savings account offers remain untouched:

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)
  • 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)

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

RELATED: Tough times for Aussie savers as Big Four banks slash rates

Interested in comparing an even wider variety of savings account, term deposit and home loan offers? Get started today with Mozo’s handy comparison tables!

*Rates accurate as of August 7, 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.

Read last month's Reserve Bank interest rates update.

Mozo may receive payment if you click products on our site. We don’t compare the entire market, but you can compare more home loans here.
Last updated 30 October 2024 Important disclosures and comparison rate warning*

Home loan comparisons on Mozo

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  • Fixed Home Loan

    • Owner Occupier
    • Principal and Interest
    Interest rate
    5.54 % p.a.
    Fixed 2 years
    Comparison rate
    5.93 % p.a.
    Initial monthly repayment
    $2,852
    Go to site

    Competitive fixed rate on up to a 30 year loan term. No application fees to pay. Additional repayments up to $20,000 per year without penalty. Free online redraw. Optional 100% offset feature ($10/month) 10% minimum deposit. Fees & charges apply, Australian Credit Licence 237879 is held by Bendigo and Adelaide Bank Limited, the credit provider.

  • 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.

  • Fixed Express Home Loan

    • Owner Occupier
    • Principal & Interest
    Interest rate
    5.54 % p.a.
    Fixed 2 years
    Comparison rate
    6.11 % p.a.
    Initial monthly repayment
    $2,852
    Go to site

    Lock in a low 2 year fixed rate with the Mozo award winning Home Lender of the Year. Available for live-in borrowers with just a 10% deposit required. Free extra repayments (up to 20% in fixed period), free redraw and partial offset available. $10 monthly service fee. Aussie support centre. Fast approvals. Up to 6 free offset accounts (T&Cs apply).

  • Fixed Home Loan

    • Owner Occupier
    • Principal and Interest
    Interest rate
    5.54 % p.a.
    Fixed 2 years
    Comparison rate
    5.93 % p.a.
    Initial monthly repayment
    $2,852
    Go to site

    Competitive fixed rate on up to a 30 year loan term. No application fees to pay. Additional repayments up to $20,000 per year without penalty. Free online redraw. Optional 100% offset feature ($10/month) 10% minimum deposit. Fees & charges apply, Australian Credit Licence 237879 is held by Bendigo and Adelaide Bank Limited, the credit provider.

  • Fixed Express Home Loan

    • Owner Occupier
    • Principal & Interest
    Interest rate
    5.54 % p.a.
    Fixed 2 years
    Comparison rate
    6.11 % p.a.
    Initial monthly repayment
    $2,852
    Go to site

    Lock in a low 2 year fixed rate with the Mozo award winning Home Lender of the Year. Available for live-in borrowers with just a 10% deposit required. Free extra repayments (up to 20% in fixed period), free redraw and partial offset available. $10 monthly service fee. Aussie support centre. Fast approvals. Up to 6 free offset accounts (T&Cs apply).

  • Fixed Rate Home Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <60%
    Interest rate
    5.59 % p.a.
    Fixed 5 years
    Comparison rate
    6.27 % p.a.
    Initial monthly repayment
    $2,867

    Get repayment certainty with HSBC’s low 2 Year Fixed Rate Home Loan. Make up to $10,000 of extra repayments a year. The option to split your home loan between fixed and variable. Plus, score $3,288 cashback when you refinance an existing home loan of $250,000. Must apply by 28 February 2023 and settle by 30 April 2023.

  • Fixed Rate

    • Owner Occupier
    • Principal & Interest
    • <80% LVR
    Interest rate
    5.74 % p.a.
    Fixed 3 years
    Comparison rate
    6.81 % p.a.
    Initial monthly repayment
    $2,915

    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.

  • Variable Home Loan

    • Owner Occupier
    • Principal and Interest
    Interest rate
    5.98 % p.a.
    Variable
    Comparison rate
    6.02 % p.a.
    Initial monthly repayment
    $2,991
    Go to site

    Competitive variable rate on up to a 30 year loan term. No application fees to pay. Unlimited additional repayments. Free online redraw. Optional 100% offset feature ($10/month) 10% minimum deposit. Fees & charges apply, Australian Credit Licence 237879 is held by Bendigo and Adelaide Bank Limited, the credit provider.

  • 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.

  • Discounted Home Value Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <60%
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    5.99 % p.a.
    Initial monthly repayment
    $2,995

    Enjoy competitive rates for owner occupiers. Enjoy unlimited free extra repayments. Flexibility to redraw additional payments for free. No ongoing monthly service fee. Receive $3,288 cashback when you refinance an existing home loan. Minimum loan amount of $250,000, settle within 120 days from applying.

  • Express Home Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <90%
    Interest rate
    6.09 % p.a.
    Variable
    Comparison rate
    6.22 % p.a.
    Initial monthly repayment
    $3,027
    Go to site

    Get online approval from the award-winning Bendigo Bank Express Home Loan. Multiple offset accounts and redraw available. 100% offset on variable rate loans and partial offset on fixed rate. Flexible repayment options. New home loans only.

  • 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.

  • Elevate

    • Owner Occupier
    • Principal & Interest
    • <80% LVR
    Interest rate
    6.18 % p.a.
    Variable
    Comparison rate
    6.18 % p.a.
    Initial monthly repayment
    $3,056

    Get competitive rates on loan terms of 5 to 30 years with the Aussie Elevate Home Loan. Structure your loan with up to five splits. Make additional repayments (T&Cs apply). Offset accounts available. Unlimited redraw using your online banking account. Choose from weekly, fortnightly or monthly payments For loan amounts from $10,000 to $5 million.

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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.