RBA holds interest rates steady at 1.50% for spring

The Reserve Bank announced at its September board meeting that interest rates would remain on hold at a low of 1.50%.

Although this month is a reprieve in the downward slide of the official cash rate, which has been hitting record lows recently, and in May 2016 dropped below 2.00% for the first time ever, experts are predicting another cut later in the year, with expectations that interest rates may reach as low as 1% next year.

In a statement, RBA Governor Glenn Stevens said “Low interest rates have been supporting domestic demand and the lower exchange rate since 2013 is helping the traded sector. Financial institutions are in a position to lend for worthwhile purposes." 

"These factors are all assisting the economy to make the necessary economic adjustments, though an appreciating exchange rate could complicate this.”

Stevens will step down as Governor on September 17 after 10 years leading the Reserve Bank board. His deputy, Philip Lowe, will take over the position.

A perfect time for home loan hopefuls?

With rates on hold at a low 1.50% for the coming month, it’s the perfect time for new homebuyers to pick up a low rate home loan offer.

Our database shows that 70 lenders passed on some or all of the 25 basis point cut from August, bringing the most competitive rates in the market to well under the 4% mark. We’ve rounded up the best offers below:

Best variable rate home loan offers

Product	Variable rate	Comparison rate
Reduce Home Loans Rate Buster Variable	3.35%	3.42%
Homestar Owner Occupier Loan	3.44%	3.49%
Reduce Home Loans Rate Buster Offset Variable	3.44%	3.51%
Homestar Variable Rate Loan	3.48%	3.53%

*All home loans rates based on owner occupiers with an LVR of 80%

Best fixed rate home loan offers

• 1 year fixed rate: 3.59% Greater Bank (Comparison rate 4.42%)
• 2 year fixed rate: 3.69% Bankwest (Comparison rate 4.29%), Newcastle Permanent (Comparison rate 4.75%), Mystate (Comparison rate 4.91%)
• 3 year fixed rate: 3.59% Police Credit Union (Comparison rate 4.81%), Bank of Queensland (Comparison rate 4.98%).
• 4 year fixed rate: 3.74% Greater Bank (Comparison rate 4.34%)
• 5 year fixed rate: 3.74% Greater Bank (Comparison rate 4.32%)

You can find all the other great home loan offers available in our home loan comparison table.

Savers are feeling the pinch

It’s been another rough month for savers, as heaps of lenders, including all four big banks, as well as other major players like Bankwest, ING Direct, UBank and ME dropped rates on their savings products by 25 basis points.

This is bad news for beleaguered savers, although there are still some providers offering a decent return, for those who know where to look. Take a look at some of the best options below:

Best savings accounts

Product	Interest rate	Special conditions
Australian Unity Easy Saver	3.20%	Introductory rate for the first 4 months
RAMS Saver Account	3.15%	Ongoing bonus rate when you make no withdrawals and deposit at least $200 each month.
ME Online Savings Account	3.10%	Ongoing bonus rate if you make a weekly Tap & Go purchase with the debit card attached to your ME Everyday Transaction Account
Citibank Online Saver	3.05%	Introductory rate for the first 4 months
Bank Australia Bonus Saver	3.00%	Ongoing bonus rate when you make no withdrawals and deposit at least $100 each month.

Visit our savings hub to check out all the other great places to stash your cash and compare savings accounts side-by-side.

The real news for savers was in term deposits, where the major banks actually increased rates over the last month. Terms shorter than 1 year still suffered from rate drops, but for savers willing to lock their cash away for terms longer than a year, rate rises outweighed cuts across the board.

Best term deposits

Term	Provider	Rate
3 months	Arab Bank	3.10%
6 months	ME	3.00%
7 months	Newcastle Permanent,Maitland Mutual Building Society	3.00%
1 year	Gateway Credit Union	3.11%
2 years	ANZ,People's Choice Credit Union	3.20%

To see the other term deposits offering Aussies a chance to grow their savings stash, check out our term deposit comparison table.