ANZ has joined the rest of the big four banks in slashing its fixed rates on its home loans.
The major bank joined the below 6 per cent club on Friday when it cut rates by up to 0.7 percentage points.
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ANZ had held out on changing rates, while its banking peers were busy making cuts in recent months.
National Australia Bank slashed fixed rates for owner-occupiers and investors on Tuesday after it became the first of the big four to offer fixed rates below 6 per cent when it initially dropped rates in July.
Commonwealth Bank and Westpac also lowered fixed home loan rates in August.
ANZ’s lowest fixed rate is now 5.99 per cent for its two and three-year terms for owner-occupiers.
The bank’s owner-occupier loan rates have fallen between 0.3 and 0.6 percentage points and between 0.4 and 0.7 percentage points for investors.
Fixed rates for owner-occupiers were cut by up to 0.6 percentage points and up to 0.7 for investors.
More than 37 lenders have dropped at least one fixed rate over the last month, according to Canstar research.
Canstar data insights director Sally Tindall this week said she expected more cuts to come, with fixed rates expected to continue to drop in the lead-up to Christmas.
“Other lenders — both big and small — are likely to cut fixed rates in coming weeks as competition in this space starts to finally defrost,” Tindall said.
Homeowners are anxiously awaiting the Reserve Bank of Australia (RBA) to drop interest rates from the 13-year high of 4.35 per cent.
Central banks in the United States, Canada and New Zealand are among those that have reduced interest rates, but the RBA maintains Australia is in a different boat.
Minutes from the Reserve Bank of Australia’s last meeting confirmed the case to lift interest rates again was not explicitly discussed.
Commonwealth Bank head of Australian economics Gareth Aird observed a “less hawkish” tilt to the RBA’s rhetoric on its next interest rates moves.
“This leaves the door open to a shift to neutral by the end of this year and then easing in early 2025,” he said.
An improving outlook for inflation and interest rates is helping buoy consumer confidence, according to Westpac and the Melbourne Institute’s index.
While pessimists still outnumber optimists, the headline index rose to 89.8 in October, from 84.6 in September, clocking its best reading since the RBA started hiking rates two and a half years ago.
Consumer attitudes had been supported by interest rate cuts abroad and more promising signs that inflation was moderating locally, Westpac head of macroeconomic forecasting Matthew Hassan said.
“This is the most promising update we have seen over the cycle to date,” he said.
– With AAP
