Banks Respond to RBA’s Rate Cut

Banks are making cuts in variable loan rates, one-year fixed rates and three-year fixed rates, among other things, as a knee-jerk reaction to the Reserve Bank’s decision of a further 25 basis point cut. The banks are borrowing at a lesser cost in the fixed-rate market and they are more than glad to transfer the savings to the customers.

ME Bank has kind of pioneered the rate revision, what with its five-year fixed home loan rates coming down by 120 basis points, three-year rates by 56 points and one-year rate by 20 points.

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