SYDNEY, AAP – ANZ Bank has become the latest lender to cut home loan rates despite market predictions that official rates will rise.
ANZ on Thursday dropped variable interest rates by up to 0.2 per cent for new customers, depending on deposit size.
Customers with a 30 per cent deposit will be charged interest of 2.19 per cent. Those with a 20 per cent deposit will be charged 2.29 per cent.
The cuts contrast with the fixed rate market, where rates have increased.
RateCity research director Sally Tindall said ANZ had matched Westpac in having the lowest variable rate among the big banks.
“Fixed rates might be on the rise, but competition in the variable rate market is still alive and kicking,” she said.
There were 72 variable rates of less than two per cent, according to RateCity.
Ms Tindall noted the low rates were for new customers. She said people with loans would have to switch lenders or haggle with their current lender for a better deal.
One lender, Athena, was an exception. This week it dropped its rates for new and existing customers.
Reduce Home Loans offered the lowest variable rate. This is 1.77 per cent for a 20 per cent deposit.
Around the world, interest rates are generally tipped to rise this year after economies recovered from the initial shock of the pandemic.
The US Federal Reserve is tipped to raise rates several times this year.
The Reserve Bank of Australia however has maintained it will not increase the cash rate before 2024.
(Disclosure: The journalist has a loan with Athena)