CBA, Westpac jack up fixed home loan rates as RBA pressure mounts

Australia’s biggest banks are ratcheting up fixed home loan rates again as expectations of further Reserve Bank (RBA) tightening ripple through the market. 

On Wednesday, CBA lifted its fixed rates by up to 0.25 percentage points, while Westpac increased selected terms by as much as 0.30 percentage points.

This is the second time in six weeks that CBA has hiked fixed rates, pushing all of its sharpest fixed offers into the 6% range for owner‑occupiers paying principal and interest.

The move comes after RBA lifted the cash rate to 3.85% earlier this month, intensifying pressure on mortgage holders and investors. Major banks are split on what happens next: NAB and Westpac see a pause in March before another hike in May, ANZ expects the RBA to hold for the rest of the year, while CBA says the next move will depend on incoming data.

CBA and Westpac push fixed rates into the 6s

Following the latest changes, CBA’s lowest one‑, two‑ and three‑year fixed rates now sit at 6.19%, 6.04%, and 6.29% respectively, with four‑ and five‑year terms at 6.34% and 6.49%. Westpac’s equivalent one‑, two‑ and three‑year fixed rates have risen to 5.79%, 5.89%, and 5.99%, while its four‑ and five‑year offers are at 6.09%.

“This latest round of fixed rate increases from Australia’s two biggest banks are in response to elevated fixed rate funding costs, but also an expectation this is not the end of the cash rate hikes,” Canstar.com.au’s data insights director, Sally Tindall (pictured) said.

“This is the second spate of fixed rate hikes from CBA in the space of six weeks. These two moves combined have pushed every one of its sharpest offers into the 6’s.”

NAB leads majors as sub‑5% fixed deals vanish

Within the big four, NAB now has the lowest advertised fixed rates across all main loan terms, with ANZ matching the cheapest two‑year rate at 5.79% and Westpac sharing the lowest five‑year rate at 6.09%.

CBA and Westpac are part of a broader repricing wave. Around 60 lenders have increased at least one fixed rate since the RBA’s 3 February cash rate move, and fixed rates under 5% have disappeared from the market. The sharpest deals on Canstar.com.au now start at 5.18% for two‑ and three‑year terms with BankVic, and 5.24% for a 1‑year fix from Horizon and Southern Cross Credit Union.

Fixed rates still out of favour with borrowers

Despite the latest rises, fixed loans remain deeply out of favour. CBA has the highest share of fixed‑rate customers among the majors, yet they account for just 4% of its mortgage book, down from 9% a year earlier, with Westpac, NAB, and ANZ all sitting at similarly low single‑digit levels.

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