Reserve Bank Cuts Rates By 0.25%

Today the Reserve Bank of Australia cut official interest rates to 3.00%.  The lowest in 50 years.

The question is will the banks also pass on the 0.25% reduction onto its customers. The banks are still citing that the cost of funding is high but no matter which way we look at it they will all follow each others lead and offer similar rates across the board.

None of the major banks can afford to discount their rates significantly more than the others as they risk being inundated with applications that they cannot service. So each lender will move cautiously to avoid stressing their systems.

I will keep you updated on which lenders pass on the 0.25% and publish them as they come in.

UPDATE: Lenders passing on the rate cut

CBA – 0.10%

NAB – Nil claim they cannot afford it

ANZ – 0.10%

More to come as they release their intentions to the market. I expect the other lenders to follow ANZ and CBA

Westpac – 0.10%

St George – 010%

Suncorp – 0.10%

ING – 0.10%