Australian Banks Delay Passing on RBA's Interest Rate Cut

The Reserve Bank of Australia’s 0.25% cash rate cut offers relief for mortgage holders, but major banks are implementing the reductions weeks later.

The Reserve Bank of Australia reduced the cash rate to 4.1%, marking a significant shift after years of rate hikes.
The big four banks—Commonwealth Bank, ANZ, NAB, and Westpac—announced rate cuts but will delay implementation by up to two weeks or more.
Delays in passing on rate cuts allow banks to profit by maintaining higher rates temporarily, though competition pressures them to act eventually.
Mortgage holders stand to save hundreds to thousands annually depending on loan size, but these savings can be maximized by maintaining current repayment levels or refinancing.
Experts advise borrowers to use the savings strategically, such as paying down loans faster or investing, rather than succumbing to lifestyle inflation.