Lenders should pass on any RBA cuts in full, regardless of the RBA’s decision tomorrow, argues one industry spokesperson.
Financial comparison site RateCity’s Michelle Hutchison says many believe the RBA will lower the cash rate by 0.25 basis points to 2.75% on Tuesday and, if they do, she says there’s no reason why lenders shouldn’t pass on the full cut to variable home loan borrowers.
“Most lenders kept some of the rate cuts after every cash rate reduction since November, 2011. But with funding pressures easing and the mortgage market slow, lenders have room and reason to move and it will be disappointing to see them not pass the full cuts onto their variable home loan customers.”
However, even if the RBA decide to keep the cash rate as is, Hutchison says it’s likely we’ll still see lenders cut their variable home loan rates.