On Friday, both Australia and New Zealand Banking Group and National Australia Bank (OTC: NABZY) raised their variable home loan interest rates. They did this because the central bank raised its rates by 50 basis points (bps).
After the Reserve Bank of Australia (RBA) raised its cash rate for the fifth time since May, to a seven-year high of 2.35%, Westpac Banking (NYSE: WBK) Corp and the country’s biggest lender Commonwealth Bank of Australia (OTC: CMWAY) are also likely to raise their mortgage rates.
On September 16, they said, ANZ and NAB customers will have to pay new rates.
Both lenders also said that savings account rates are still being looked at.
So far, Australian lenders have followed the RBA’s lead and passed on the full rate increase to their customers. They do this because they expect to make money at a time when the country’s housing market is starting to slow down.
In August, housing prices fell the most they had in 40 years. This was because rising interest rates and rising costs of living hurt demand, which could hurt household wealth and confidence.
