Competition heats up as CBA cuts fixed rates alongside variable

Five other lenders have cut at least one fixed rate since the RBA cash rate cut, with more rate cuts predicted in the coming months.

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Five other lenders have cut at least one fixed rate since the RBA cash rate cut, with more rate cuts predicted in the coming months.

CBA has today announced it will take the axe to its fixed rate home loans tomorrow by up to 0.40 percentage points across all fixed terms.
This move will land at the same time the bank is cutting its variable mortgages by 0.25 percentage points, following the May RBA cash rate cut.
As a result of these changes, CBA’s new lowest fixed rate will be 5.49% for 3-years.

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CBA’s new lowest fixed rates – 30 May 2025
Term	New rate from	Change % pts
1-year	5.69%	-0.40%
2-year	5.74%	-0.25%
3-year	5.49%	-0.25%
4-year	5.89%	-0.25%
5-year	6.29%	-0.25%

Source: Canstar. Notes: based on owner occupied loans with principal and interest repayments. Package fees apply. LVR requirements apply. Rates effective 30 May 2025.

ANZ and NAB still offer the lowest fixed rates out of the big four

These cuts by CBA, when implemented, will not see it claim the title of the lowest fixed rates out of the big banks. ANZ still has the lowest 1- and 2-year fixed rates among the big four banks, while NAB has the lowest 3-, 4- and 5-year fixed rates.
These fixed rates are for owner-occupiers paying principal and interest.

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Big four banks’ lowest fixed rates
Term	CBA*	Westpac	NAB	ANZ
1-year	5.69%	5.69%	5.54%	5.49%
2-year	5.74%	5.59%	5.44%	5.39%
3-year	5.49%	5.89%	5.39%	5.69%
4-year	5.89%	5.89%	5.79%	5.84%
5-year	6.29%	5.89%	5.79%	5.84%

Source: Canstar. Notes: based on owner occupied loans with principal and interest repayments. LVR requirements apply. * CBA rates effective 30 May 2025.

Fixed rates continue to fall as market expectations of further cash rate cuts ramp up

Five lenders (excluding CBA, which will move tomorrow) have cut fixed rates since the 20 May RBA decision, while 20 lenders have already cut at least one fixed rate this month, rate tracking shows. A total of four lenders—BOQ, Community First Bank, Police Bank and Queensland Country Bank—are now offering at least one rate under 5% at 4.99%. Bank Australia also has a green home loan at 4.94%

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Lowest fixed rates on Canstar.com.au
Term	Lender	Lowest rate from
1-year	Macquarie Bank	5.29%
2-year	BOQ, Community First Bank	4.99%
3-year	BOQ, Community First Bank, Police Bank, Queensland Country Bank	4.99%
4-year	BOQ	5.29%
5-year	BOQ	5.29%

Source: Canstar. Rates are for owner-occupiers paying principal and interest. LVR requirements may apply. Excludes eco loans.

CBA fixed rate cuts are just the start

Canstar’s data insights director, Sally Tindall says, “Fixed rates have been falling fairly consistently this year and we expect this activity will continue as banks price in the increasing likelihood of further cash rate cuts.”“CBA’s fixed rate cuts aren’t groundbreaking, but rather a bid to inch closer to its key competitors.

“From tomorrow, the bank’s lowest variable rate will be sitting at 5.59 per cent, while its lowest fixed rate will be 5.49 per cent. With just a 0.10 percentage point difference, and the possibility of further RBA cuts ramping up, it’s hard to see many people jumping at the chance to lock up their mortgage for the next three years.

“We expect banks big and small will continue cutting fixed rates over the next few months. We’ve already got four lenders with at least one fixed rate under 5 per cent, however, this could well become the norm for banks by the end of the year.

“The majors might have to offer a fixed rate in the ‘4’s’ if they’re serious about getting people to lock in their rate.
“That said, some borrowers have relished the calm that a fixed rate can bring and could well be looking for another opportunity to lock in.

“For others, it will be about chasing the lowest possible rate and for these borrowers, they’re unlikely to pass up the opportunity to capitalise on further cash rate cuts just yet, particularly with banks fighting hard on variable rates to secure new business.

“If you’re deciding between a fixed or variable rate, understand what might suit your finances and to some extent, your personality. When you make a decision, take the time to look for a competitive rate.”