At yesterday’s monthly board meeting, the Reserve Bank cut the official cash rate by 25 basis points, following data a week earlier that showed Australia’s lowest core inflation rate on record. The move took the official rate to a record low of 1.75 per cent.
NAB almost immediately announced that it would pass on the full cut on its standard variable business loans as well as to residential customers, as did Westpac.
Less than an hour before the federal budget was announced, CBA quietly followed suit, passing on the full rate cut on variable business loans and residential mortgages.
NAB’s rate cut will take effect from Monday 16 May, while CBA will delay the cut until Friday 20 May and Westpac until Monday 23 May.
ANZ also cut its interest rates, however the cut was not uniform. All variable business loans will decrease by the full 25 basis points from Friday 13 May, while variable residential home loans will only fall by 19 basis points. However, the bank also announced an increase in deposit rates for four-month term deposits to 3.00 per cent (up from 2.00 per cent).
The move comes after ANZ announced a hefty 24 per cent fall in cash profit for the six months to 31 March.