Banking giant’s fixed rates move mostly above 6%
ANZ has increased several fixed home loan rates by as much as 0.25 percentage points, moving ahead of the Reserve Bank of Australia’s cash rate decision due tomorrow, March 17.
Following the change, most of ANZ’s lowest fixed rates now sit above 6%, with only its lowest one-year fixed rate at 5.99%.
Across the major banks, National Australia Bank continues to post the lowest advertised fixed rate among the big four, at 5.74% for a one-year term.
| Big four banks’ lowest fixed rates | ||||
|---|---|---|---|---|
| Term | CBA | Westpac | NAB | ANZ |
| 1-year | 6.19% | 5.79% | 5.74% | 5.99% |
| 2-year | 6.04% | 5.89% | 5.79% | 6.04% |
| 3-year | 6.29% | 5.99% | 5.84% | 6.14% |
| 4-year | 6.34% | 6.09% | 5.99% | 6.19% |
| 5-year | 6.49% | 6.09% | 6.09% | 6.34% |
| Source: Canstar.com.au | ||||
Financial comparison platform Canstar’s rate tracking shows 26 lenders have raised at least one fixed rate in the past fortnight, including Bankwest, ubank, Heritage Bank and RACQ.
The shift has altered the relationship between fixed and variable pricing. Canstar said the average two-year fixed rate is now 0.21 percentage points higher than the average variable rate, a change from the start of the year when average fixed and variable rates were broadly aligned.
Canstar data also indicates the cheapest fixed rate listed is 5.24% from Southern Cross Credit Union, available for one or two years. After the recent increases, only four lenders still offer at least one fixed rate below 5.40%, down from 62 at the start of the year.
“ANZ has jumped the gun on the RBA, lifting fixed rates just four days out from the central bank’s next decision,” said Sally Tindall (pictured right), data insights director at Canstar.com.au.
“Fixed rates are typically the early warning signal for where rates are headed. When they start creeping up before an RBA meeting it’s a sign lenders are pricing in a hike before it materialises.
“The fact that the majority of ANZ’s fixed rates now sit above 6% will feel like a psychological shift for borrowers.
“ANZ is far from alone in moving fixed rates though. Analysis of the Canstar database shows 26 lenders have moved 466 fixed rates in the past fortnight alone.”
Tindall noted that, over the past week, many economists have lifted their expectations of a cash rate rise, citing stubborn inflation and the risk that higher petrol prices could add to price pressures. Australia’s major banks, including ANZ, have forecast back-to-back increases at the next two monetary policy meetings.
“As a result, some borrowers could now be thinking about flipping over to fixed,” she said. “If that’s you, don’t panic. Walk through the decision with a calm and clear head, noting the risks on both sides and the extra rules and restrictions that come with locking in your rate.
“The cash rate could well rise in coming weeks, but the fallout from the war, if it hits the Australian economy and jobs market hard, could also push the RBA into reverting back to cuts in the not too distant future.
“That said, shopping around can still make a big difference, regardless of whether you decide to fix or stick with a variable rate.”
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