Westpac Banking Corp, a prominent Australian lender, has announced its decision to increase its home loan variable interest rates by 25 basis points (bps), aligning with the recent rate hike implemented by the Reserve Bank of Australia (RBA). This surprising move by the RBA saw a quarter-point increase, taking the interest rates to an 11-year high. Moreover, the RBA has expressed concerns about the possibility of further tightening to ensure the return of inflation to the targeted level.
Presently, the cash rate stands at 4.1%, signifying a substantial cumulative increase of 400 basis points since May of the preceding year in the RBA’s ongoing battle against inflation. Scheduled to be implemented on June 20, Westpac’s new home loan rate adjustment aims to reflect the RBA’s policy shift.
Notably, Westpac has emerged as the first among the “big four” banks to pass on the central bank’s recent rate hike to its valued customers. It is anticipated that the remaining three major banks will soon follow suit, aligning their rates with the RBA’s upward adjustment.