Banks prepare to keep RBA rate cut

Mortgage broker AFG's NSW/ACT state manager Chris Slater said the banks have gone to great lengths to forewarn borrowers and brokers that any rate cuts delivered by the RBA may be withheld.

ANZ's chief executive Australia Phil Chronican said the bank's funding costs were now “largely unrelated” to movements in the official cash rate and the bank now reviews its rates on the second Friday of each month – independently of the RBA.

Westpac's chief executive Gail Kelly told press that the lender had decided to follow ANZ's suit and review its mortgage rates independently of the Reserve Bank.

RP Data's senior research analyst Cameron Kusher said if the banks withhold some or all of the rate cut, it would really hurt the level of housing activity.

Source: The Adviser