CBA is the first big bank to finally announce it will pass on the RBA's 0.25 percentage point rate hike in full to variable borrowers, effective from 9 October.
As a result, CBA’s lowest variable home loan rate will be 6.34%.
CBA is keeping its savings customers in the dark for now, listing its savings rates as under review.
CBA’s lowest home loan rate, effective 9 October | ||
|---|---|---|
Old rate from | New rate from | |
Lowest variable rate | 6.09% | 6.34% |
Source: Canstar. Rates based on owner-occupier variable-rate loans. LVR requirements apply.
CPI points to yet another rate hike in November
Stubborn inflation will keep the pressure on the RBA to consider another cash rate hike at its next meeting on 2 - 3 November.
ABS figures released show headline CPI came in at 4.0% in the year to August, up from 3.5% in the month prior.
Trimmed mean, the RBA’s preferred measure, stayed put at an annual rate of 3.6% for the third consecutive month. This is also the ninth monthly result where core inflation has failed to drop.
Westpac tips November hike
Westpac has adjusted its cash rate forecast and now expects the RBA to hike by a further 0.25 percentage points at the next meeting on 2 - 3 November.
Previously, the bank’s economic team had expected the cash rate to peak at 4.60% in September, followed by three 0.25 rate cuts starting in mid-2027. However, it now expects that higher energy prices caused by the conflict in the Middle East will force the RBA to hike once more.
ANZ’s forecast already had a fifth RBA hike in November, taking the cash rate to 4.85%.
CBA and NAB expect the RBA to hold the cash rate in November.
Big banks’ cash rate forecasts for next RBA meeting | |
|---|---|
November | |
CBA | On hold |
Westpac | +0.25 |
NAB | On hold |
ANZ | +0.25 |
Source: Prepared by Canstar.
If the RBA is forced to increase the cash rate again, Canstar analysis shows a further 0.25 hike would add another $92 per month to a $600,000 loan with 25 years remaining.
However, across what would be five hikes for the year, that’s an increase of $456 to their monthly repayments and $759 extra a month for anyone with $1 million debt.
Impact of 0.25 cash rate hike in Nov on monthly repayments | ||
|---|---|---|
Loan size at start of hikes | Hike in Nov | Cumulative increase across 5 hikes |
$500,000 | +$77 | +$380 |
$600,000 | +$92 | +$456 |
$700,000 | $107 | +$532 |
$800,000 | +$123 | +$607 |
$900,000 | +$138 | +$683 |
$1 million | +$153 | +$759 |
Source: Canstar. Based on an owner-occupier paying principal & interest with 25 years remaining in Feb 2026 at the RBA avg variable rate. Assumes rate hike in Sep and Nov and banks pass it on the month after. Changes are to minimum repayments.
We might not be done with RBA hikes
Canstar’s Data Insights Director, Sally Tindall, says, “CBA is the first cab off the big bank rank, announcing, with much delay, that it will be passing on yesterday’s cash rate hike in full to its variable borrowers.”
“CBA might have taken more than 24 hours to make its announcement, and let’s be clear, that’s too long to keep customers in the dark, however, at least it’s ahead of its big bank competitors who are still keeping their customers waiting.
“Disappointingly, Australia’s biggest bank has not announced what it will do for its savings customers. Instead, it’s playing a now well-established game of wait-and-see, buying it time to assess what other banks will be offering up.
“Even at this new cash rate setting of 4.60 per cent, we might not be done with RBA hikes.
“Today’s CPI results confirm inflation, particularly core inflation, is firmly stuck. We’ve just had the ninth consecutive month of data where core inflation has failed to drop, while headline inflation is unsurprisingly back on the rise.
“While the RBA will have September CPI and Labour Force data to consider before its next decision, it has already made it clear that another hike is on the table if inflationary pressures continue to build.
“Westpac didn’t wait for today’s August CPI to print before forecasting another hike, joining ANZ in tipping the RBA will lift the cash rate by a further 0.25 percentage points in November.
“The prospect of a fifth rate hike this year will be a bitter pill to swallow for already-stretched households. A further 0.25 percentage point increase would add around $92 a month to repayments on a typical $600,000 mortgage, taking the cumulative hit from five hikes to around $456 a month.”
