The RBA continues to leave interest rate on unchanged Interbank lending rates, the interest rate that applies when banks lend to each other, continues to increase.
Australia’s banks rely heavily on people depositing their savings with them. These funds are used to fund mortgages and other loans. However, deposits alone are not enough and banks also rely on borrowing funds from money markets abroad to source their available funds. The cost for the banks to source these funds from overseas is starting to increase, largely due to the interest rates increasing in the USA. So whilst the RBA may not increase interest rates in the short term, banks in Australia may increase their lending rates regardless, due to the cost of sourcing money from overseas.
If you would like to discuss fixing your interest rate, please feel free to phone or email us directly and we can advise the options available to you.