Banks to continue keeping rate cuts

After the official RBA cash rate cut last week, Commonwealth Bank of Australia lowered its mortgage rate by 0.40 of a percentage point, National Australia Bank by 0.32 and Westpac by 0.37. ANZ will announce its rates decision this week.

Experts said the banks would keep moving their rates out of step with the RBA in the near future in a bid to counter higher funding costs and a squeeze on profit margins.

“It is not something that is done and dusted,” said Tim Roche, director of credit ratings agency Fitch. “It is something that is going to be with us for a while.”

Source: Australian Financial Review