ANZ has become the latest major bank to slash fixed mortgage rates in a sign of more relief to come.
The Big Four bank has cut its fixed mortgages rates for the second time in three weeks, ahead of the Reserve Bank’s November meeting.
It has cut fixed rates by 25 points for borrowers with a 20 per cent deposit.
Mortgage rates, fixed for two to five years, are now all below 6 per cent.
ANZ now offers the lowest mortgage rate of 5.74 per cent – fixed for two and three years – among the Big Four banks.
Canstar data insights director Sally Tindall said competition among the banks was heating up, with economists expecting the Reserve Bank of to slash rates next year.
‘This strategic play from ANZ means the bank now offers the lowest fixed rate out of the majors as competition in this space continues to push rates south,’ she said.
SWS Bank offers the lowest rate overall, of 4.99 per cent, also with a three-year fixed term.
The 30-day interbank futures market is expecting the RBA to cut rates three times next year.
Earlier this month, it was expecting four rate cuts.
An ANZ borrower now on a 6.14 per cent variable rate, who fixed at 5.74 per cent for three years, would not only get a saving of 40 basis points.
That would mean a monthly saving of $163 on an average, $636,208 mortgage.
Should the RBA cash rate fall by 75 basis points in 2025, they would be missing out on 35 basis points worth of relief.
Put another way, someone fixing too early would miss out on $140 worth of savings, adding up to $1,680 a year.
Inflation data for the September quarter is due out on Wednesday.
The Commonwealth Bank, ‘s biggest home lender, is predicting headline inflation easing to 2.9 per cent, down from an annual level of 3.8 per cent in the June quarter.
This figure covers volatile items like petrol prices falling and the federal government’s one-off $300 electricity rebates.
But underlying inflation, excluding volatile items, was still expected to be above the RBA’s 2 to 3 per cent target.
CBA is expecting the trimmed mean measure of inflation to fall to 3.4 per cent, down from 3.9 per cent.
SWS BANK: 4.99 per cent for three years
PEOPLE’S CHOICE: 5.49 per cent for four and five years
ANZ: 5.74 per cent for two and three years
CBA: 5.89 per cent for three years
NAB: 5.89 per cent for three years
WESTPAC: 5.89 per cent for two, three, four and five years