Rate drop: Macquarie cuts fixed rates ahead of RBA meeting
Macquarie Bank has reduced its fixed-rate mortgages weeks before the Reserve Bank of Australia’s first meeting of 2025.
According to Canstar’s rate tracking, Macquarie Bank has reduced its one- to three-year fixed-rate mortgages by up to 0.16 percentage points.
The bank’s lowest fixed rate now reaches 5.55 per cent and is available for owner-occupiers on a two- to three-year fixed rate, paying principal and interest with a deposit of at least 30 per cent.
The move comes four weeks ahead of the RBA’s cash rate decision on 18 February, with Canstar noting it will potentially escalate competition in the fixed-rate market.
Independent financial comparison site Canstar data insights director, Sally Tindall, said while Macquarie Bank’s cuts are minor, they could drive competition in the lender market.
“While fixed rates often reflect the cost of wholesale funding, the prospect of cash rate cuts in the next few months is likely to encourage more lenders to take the knife to their fixed rates,” Tindall said.
“The fixed-rate market has been relatively quiet over the summer break, with more lenders hiking these rates in the month of December than cutting.”
“However, this move from Macquarie could push other lenders into taking a look at the competitiveness of their fixed rates in the lead-up to the RBA’s next meeting,” Tindall said.
Canstar’s analysis said Australia’s fifth-largest creditor, Macquarie Bank’s fixed cut rate of 5.55 per cent over two years positions the bank to just 0.06 percentage points of the lowest two-year rate in the comparator database, at 5.49 per cent for EasyStreet, BankVic and Community First Bank.
Compared to the big four, Macquarie Bank has lower fixed rates across all terms.
Macquarie Bank’s two-year fixed rate is 5.55 per cent, while ANZ is at 5.74 per cent and Westpac reaches 5.89 per cent.
NAB and CBA have the highest fixed rate over the same term, with 6.04 and 6.29 per cent respectively.
Tindall said despite Macquarie Bank’s fixed rate cut, borrowers will wait for the RBA’s meeting to act on their mortgages.
“While Macquarie Bank’s new lowest fixed rate of 5.55 per cent is highly competitive when stacked up against the rest of the pack, it’s unlikely to push many borrowers into fixing now cash rate cuts are firmly on the radar,” she said.
“Right now, the majority of borrowers are opting to stay on a variable rate, most likely in the hope we’ll see a flurry of cash rate cuts that will deliver relief in the months ahead.”
Yet, Tindall warned borrowers not to expect a “multitude of cuts in quick succession”.
“While at least one cash rate cut this year is highly likely, not even the RBA knows exactly how many there will be,” Tindall said.