Powered by MOMENTUM MEDIA
SUBSCRIBE TO OUR NEWSLETTER SIGN UP
Powered by MOMENTUM MEDIA

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.

Fixed rates back en vogue

Staff Reporter 4 minute read

By: Jessica Darnbrough

The recent reduction in fixed rate mortgages suggests Australia could be coming to the end of the upwards rate cycle.

In the last four weeks, four of the big five have slashed basis points from their fixed rate mortgages.

Yesterday, CBA announced it would cut more than 40 basis points off some of its owner occupied and investment home loan fixed rates.

Advertisement
Advertisement

According to AMP chief economist Shane Oliver, the recent fixed rate reduction reflects a decline in the longer term sale of bond yields.

“The cost of long term yields has come down, and as such, the banks are passing this reduction on to their customers,” he told The Adviser.

Mr Oliver said he expects the RBA to hike rates one more time before the end of the year.

“Originally I had expected rates to hit 5 per cent by the end of the year, but we have now revised this forecast down to 4.75 per cent,” he said.

At present, lenders are offering some of the best deals on fixed interest rate home loans in recent years.

PROMOTED CONTENT


Loan Market national operations and risk manager Ivan Karamatic said the majors’ recent rate cuts had meant the fixed rate market had suddenly become highly competitive.

“Some fixed rate packages currently on offer are only slightly higher than some of the standard variable rates,” he said.

“In some instances the difference between a three year fixed rate and that of a standard variable is as little as 0.38 per cent.

“That’s only one or two RBA interest rate hikes away from mortgage holders being potentially better off with the fixed package.”

Fixed rates back en vogue
default
TheAdviser logo

The not-to-be-missed Accountants Daily Strategy Day will travel through Melbourne and Sydney in August to equip accounting professionals with the latest industry updates and tips for modern practice management as well as the latest cutting-edge technology, processes, strategies and trends shaping the future of accounting. Visit the website for more information: www.accountantsdaily.com.au/strategy-day

default

 

more from the adviser
Greater Bank Newcastle Perm merger

Breaking News

Two banks announce intention to merge

Two large customer-owned banks have announced that they are inten...

Paul Herbert AMP Newsroom

Breaking News

AMP hires intermediary head

AMP Bank has recruited from MyState for its new head of intermedi...

Theo and Alex Shore Financial

Breaking News

Brokerage officially launches white-label loan

North Sydney-based brokerage Shore Financial has officially launc...