Macquarie Bank has announced reductions in interest rates for three of its fixed-rate home loans ahead of the Reserve Bank’s first meeting of the year. The bank, Australia’s fifth-largest lender, decreased its one-year fixed rate by 0.16 percentage points to 5.69%, while the two and three-year fixed rates were also cut by 0.14 percentage points to 5.55%. Although these rates are not the lowest available, they surpass those offered by the big four banks. According to Canstar’s data insights director, Sally Tindall, these adjustments may ignite competition in the fixed-rate market, particularly as a potential cash rate cut looms in the coming months.
The Reserve Bank is set to reveal its interest rate decision on February 18, with growing confidence among economists regarding a possible cash rate reduction for the first time since November 2020. Tindall noted that, while the fixed-rate market remained quiet over summer, Macquarie’s move might prompt other lenders to assess their competitiveness as the RBA’s meeting approaches. Currently, most borrowers are favouring variable rates in anticipation of potential cash rate cuts that could offer financial relief soon. The upcoming release of quarterly inflation statistics will be crucial in informing the RBA’s decision.