Australian mortgage provider Loan Market believes that major banks in the country will not implement further lending rate increases, after having done so last month.
The Reserve Bank of Australia (RBA) maintained its cash rate at 4.25 percent for the second month at its latest board meeting.
A poll of Loan Market’s 138-strong mortgage broker network revealed that 65 percent of respondents predicted no change in commercial lending rates for the month of March.
However, 31 percent of brokers expect banks to implement an additional increase of 10 basis points, while only four percent said that the increase could be 20 basis points. No broker expected a rate cut.
Although the Bank of Queensland raised its standard variable interest rates by 10 basis points, it was one of the few lenders that did not increase its mortgage rates last month, said Paul Smith, Corporate Spokesman at Loan Market.
Banks acted in February to compensate for global conditions and adjust to conditions that occurred during the RBA’s summer break, he noted.
“In the past month, we haven’t seen any significant developments, from a funding perspective, to signal the major banks to raise rates above their increases last month.”
“If they increase rates again it will only be slight posturing and nothing significant,” he added.
Still, the mortgage industry will be closely monitoring the result of ANZ Bank’s monthly rate meeting on Friday, as it was the first bank to change its lending rate last month.
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