<\/p>\n
Reserve Bank of Australia\u2019s Governor Michele Bullock chose to hold rates last Tuesday, but the board has warned it will not hesitate to hike rates if needed. Picture: NewsWire \/ Christian Gilles<\/p>\n
A Reserve Bank warning that another rate hike is on the cards has split the major banks, with homeowners set to be hit \u201clike a hammer\u201d by a surge in costs.<\/p>\n
Two major lenders \u2013 Aussie and Hume Bank \u2013 slashed interest rates in the seven days since the RBA decision to hold the cash rate target at 4.35 per cent, but the ripple effect of its warning over another hike has shattered hopes of further relief across the board.<\/p>\n
<\/p>\n
Homeowners are facing surging costs including construction and rate charges. Picture: Eddie Sarafik<\/p>\n
For an owner-occupier with a $600,000 loan, another 0.25 percentage point hike in August \u2013 in line with Westpac\u2019s forecast \u2013 would add a further $92 a month to bring minimum repayments to $4,052 a month, while someone with a $1m loan would have to find $153 extra for $6,753 a monthly charge. <\/p>\n
Canstar data insights director Sally Tindall said three lenders hiked both fixed and variable rates after the RBA\u2019s warning, with this week\u2019s inflation and employment data drops crucial to what happens next.<\/p>\n
\u201cWhat\u2019s more likely to come down like a hammer is the increase to monthly mortgage repayments, which for many is still due to land over the next month,\u201d she said. <\/p>\n
\u201cWhile the May hike seems like eons ago, banks give their customers as much as two months \u2013 sometimes even more \u2013 notice before they take that extra money out of their accounts. This will be a midwinter squeeze plenty of households could do without.\u201d<\/p>\n
<\/p>\n
Owner Occupier P&I \u2013 Rate Statistics & Rate Changes from 15-Jun-2026 to 21-Jun-2026. Source: Canstar<\/p>\n
The split between the big four is stark, with Westpac forecasting two more hikes in 2026 before cuts arrive in 2027, while CBA, NAB and ANZ are all predicting the next move is a cut \u2013 with no further hikes on the horizon this year.<\/p>\n
Just three home loan rate offerings remain below 5.75 per cent, according to Canstar\u2019s database, with the average variable interest rate for owner occupiers paying principal and interest at 6.68 per cent and the lowest variable rate for any LVR at 5.69 per cent by LCU.<\/p>\n
Since the RBA warned it \u201cwill do what it considers necessary\u2026 including increasing the cash rate target further if required\u201d, Community First Bank increased one owner occupier variable rate by 0.01 percentage points and two other lenders increased 42 owner occupier and investor fixed rates by an average of 0.10 percentage points.<\/p>\n
<\/p>\n
Canstar data insights director Sally Tindall.<\/p>\n
The week itself was quiet on the rate front, with just two lenders cutting and three hiking across fixed and variable products. <\/p>\n
But Ms Tindall warns the calm may not last, with two critical data releases due this week \u2013 Wednesday\u2019s inflation figures and Thursday\u2019s labour force results \u2013 capable of shifting the dial.<\/p>\n
\u201cThe wind could pick up on the back of this week\u2019s data, but it could equally cancel each other out,\u201d she said.<\/p>\n
<\/p>\n
Early June big bank cash rate forecasts. Source: Canstar.<\/p>\n
For borrowers hunting relief, there is some. Forty lenders are currently offering at least one advertised variable rate under 6 per cent, with LCU holding the lowest variable rate on Canstar\u2019s database at 5.69 per cent \u2013 0.57 percentage points below the market average. <\/p>\n
The lowest fixed rate remains clinging to sub-6 per cent territory at 5.99 per cent.<\/p>\n
\u201cWhile LCU won\u2019t be a good fit for everyone, there are 40 different lenders offering at least one advertised variable rate under 6 per cent, including big four bank Westpac,\u201d Ms Tindall said.<\/p>\n
The government\u2019s half-extension of the temporary fuel excise cut, announced on Sunday, offers modest cost-of-living relief \u2013 but Ms Tindall notes it is a carefully managed transition, not a reprieve.<\/p>\n
BIG DATA TO WATCH THIS WEEK:<\/p>\n
Wednesday June 24: ABS Consumer Price Index; ABS Engineering Construction Activity.<\/p>\n
Thursday June 25: ABS Labour Force; ABS Monthly Household Spending Indicator.<\/p>\n","protected":false},"excerpt":{"rendered":"Reserve Bank of Australia\u2019s Governor Michele Bullock chose to hold rates last Tuesday, but the board has warned…\n","protected":false},"author":2,"featured_media":754419,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[64,63,99],"class_list":["post-754418","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-au","tag-australia","tag-business"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/754418","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=754418"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/754418\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/754419"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=754418"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=754418"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=754418"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}