Major Banks to Pass on Full Rate Cut
3:05 PM – Within 30 minutes of the RBA’s announcement, all four major banks have confirmed they will pass the full rate cut on to customers.
- NAB, Commonwealth, and ANZ will reduce their variable home loan rates by 0.25%, effective 28 February.
- Westpac will implement the same cut from 4 March.
Treasurer Jim Chalmers: “Very Welcome News”
3:02 PM – Treasurer Jim Chalmers has welcomed the RBA’s decision to cut the cash rate but cautioned that it won’t solve all economic challenges.
“This is the soft landing we have been planning for and preparing for, but we know there’s more work to do,” he stated. He emphasized that today’s decision, along with the RBA’s statement, provides confidence that inflation challenges are easing.
Commonwealth Bank Lowers Home Loan Rates
2:53 PM – The Commonwealth Bank has announced a 0.25% reduction in home loan variable interest rates following the RBA’s rate cut.
“We understand that rising rates have been difficult for our home loan customers, and we know they welcome this relief,” said Angus Sullivan, Group Executive of Retail Banking Services. He added that eligible customers may choose to reduce their mortgage repayments accordingly.
RBA Warns of Economic Uncertainty
2:45 PM – In its monetary policy statement, the RBA cautioned about lingering uncertainties in the economy.
The central bank highlighted that any boost in consumption due to rising incomes may be slower than expected, potentially leading to subdued economic growth and a weaker labor market than currently projected.
Interest Rate Cut: First Since 2020
2:30 PM – The RBA has lowered the cash rate to 4.10%, marking its first rate cut since November 2020.
This decision follows six months of steady progress in tackling inflation. Stay tuned for expert reactions and comments from RBA Governor Michelle Bullock at the upcoming press conference.
Household Spending Remains Flat
2:00 PM – Household spending has been a key factor influencing the RBA’s rate decisions.
While inflation control measures coincided with peak shopping seasons, including Black Friday, Cyber Monday, and Christmas, recent data suggests spending has stabilized.
The Commonwealth Bank’s Household Spending Insights Index remained at 153.4 in January, with notable declines in household goods and hospitality spending—a sign that Australians are adopting a cautious approach.
