Westpac has lifted its fixed rates for the third time in four weeks as the major banks retreat from record low lending rates eagerly snapped up by borrowers.
The big bank moved to hike its owner-occupier and investor rates, leaving no loan package on offer for less than 2.24 per cent.
Westpac’s three-year fixed rate loan saw the largest lift in borrowing costs, up 0.3 per cent.
Almost four rates hikes inside a month. Well done, RBA.
There is no data on how heavy is the reliance upon fixed-rate mortgages in the last boom but the anecdotal evidence is that it was very high.
While those on these rates are not about to see reset shocks for a year or so, the average loan amount available to borrowers will just have been truncated. Especially when we add higher APRA lending buffers.
House price rises are going to slow a lot and one wonders if this is not already landing on household’s outlooks:
ANZ-Roy Morgan Aus Consumer Confidence dropped 2.8%. Inflation expectations may be weighing, given the headlines that followed the rise in US CPI. Wkly inflation expectations and its 4-week moving average rose 0.1ppt to 5.0%. #ausecon@DavidPlank12@RoyMorganAuspic.twitter.com/8egQUyS4kM
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
