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While acknowledging the substantial fall in inflation since its peak in 2022, the monetary policy board said headline inflation was likely to rise to the top of the band over the coming year as “temporary factors”, like energy bill rebates, come to an end.
Still, it determined that the “risks to inflation have become more balanced” and decided to cut rates given inflation is projected to remain around target.
How much will the rate cut save mortgage holders?
Mortgage holders with a $600,000 loan would save $91 a month; those with a $750,000 loan would have $114 shaved off their monthly repayments; and those who’ve borrowed $1 million would save about $152 a month.
Which banks are passing on the latest interest rate cut?
Online lenders Athena and Unloan have also passed on the cut immediately.
How far could interest rates fall?
Unlike the other big four banks, NAB had predicted a 0.50 per cent cut in May — a move that ultimately didn’t eventuate. It has yet to update its forecasts.
