RBA's September decision: rates on hold at 2.50%

At its monthly meeting today, the Board of the Reserve Bank of Australia decided to leave the official interest rate untouched at 2.50%.

In a statement, RBA Governor Glenn Stevens said: "the Board judged that the setting of monetary policy remained appropriate. The Board will continue to assess the outlook and adjust policy as needed".

Why keep rates on hold?

The reason boils down to two words: Federal Election. In four days time, Aussies may wake up to find a change of government, and be confronted with a raft of new policies affecting all facets of life such as the the carbon tax, fringe benefits tax, paid parental leave scheme, and many more.

The Reserve Bank knows that any rate changes made before Saturday 7th will have limited impact on the economy, as businesses and households will be solely focused on the election and will unlikely commit to any new spending decisions until all the votes have been counted.

Those hoping for a rate cut however need not be disappointed by today's RBA decision. The Board has made it clear that they are open to further rate changes, with pundits predicting one or two more rate cuts by the end of the year. So watch this space, folks! We might even see a rate cut on Melbourne Cup Day!

What's news for borrowers?

Although there are no rate cuts to speak of, home loan rates are still at record lows so you can save thousands right now by switching to a cheaper loan. Here are our top picks:

• loans.com.au Dream Loan Express 4.55% variable rate  (4.57% comparison rate)
• IMB introductory variable 4.66 variable (5.40% comparison rate)
• iMortgage Essential 4.69% variable rate (4.71% comparison rate)

Not sure who's the best lender for your needs? Why not talk to Mozo's home loan experts - we've got mystery bank deals from Big 4 Banks through to online lenders. Find out more here.

And for savers?

There are still some banks who are offering great rates. Top at call rates right now include:

• RAMS Saver: 4.51% Special rate
• ING Direct Savings Maximiser: 4.50% special rate
• Bankwest Telenet Saver: 4.30% special rate for 6 months