Mozo Money Moves: RBA cuts and lenders offer relief, but savers are being punished.

This week, the Reserve Bank of Australia (RBA) excited borrowers with a 25 basis point rate cut – a welcome gift for many as households continue to battle the much higher cost of living. 

While Mozo reported on the reasons why the RBA may have kept rates on hold, we did expect if the cut was to come that lenders would quickly jump on the bandwagon, and that most if not all would pass the rate cut on in full. 

As we expected after the cut, a flurry of lenders announced they would pass on the full rate cut to mortgage holders. However, the same can’t be said for savers, with some banks slashing savings rates before they even pass on the home loan cuts they were so eager to announce.

Mozo also launched a brand-new live blog this week to track rate changes as they happen, giving you real-time updates on the financial landscape. Plus, our latest research reveals a looming refinancing frenzy, as borrowers flock to take advantage of the new variable home loan rates.

Let’s dive in!

Mozo Live is launched!

In a move to keep Australians on top of the latest financial updates – and ahead of the Reserve Bank of Australia's (RBA) crucial decision – on Monday, Mozo launched Mozo Live.

Run by our expert editorial team, who are keeping a keen eye on personal finance products and lenders, this dedicated live blog provides real-time updates on Australian interest rate news.

“Whether you're a homebuyer, borrower, or just interested in keeping an eye on the market, Mozo Live is there to help ensure you never miss a beat,” explains Rachel Wastell, Mozo Money Expert. 

“Our live blog covers everything, from rate cuts, to new product offerings, as we track the money moves occurring across the hundreds of products on the Mozo database.”

The team is live blogging the details on the RBA decisions, rate cut announcements from small and major lenders, expert analysis on how these changes impact your money and some helpful financial strategies to manage these changes.

You can check it out here.

RBA cuts for the first time in four years

On Tuesday, the RBA made its first rate cut in over four years, dropping the cash rate by 25 basis points to 4.10%. This comes after one of the most aggressive rate-hiking cycles since the early 1990s, which saw the cash rate rise by 4.00% in just under two years.

“This rate cut is significant because it marks the first time since 2020 that the RBA has moved in this direction, and it couldn’t have come at a better time,” says Wastell. 

“Australian homeowners have been feeling the impact of 13 rate hikes, and many are now hoping this cut signals some much-needed relief.”

Senior money writer Peter Terlato covered the news, and highlighted the one big question on mortgage holders' minds– when will the RBA move again? 

Although the RBA trimmed the cash rate this month, the central bank has signalled that future decisions will depend on incoming economic data, particularly inflation, wages, and employment figures. Inflation has eased, but underlying price pressures in housing and services remain a concern, and the RBA is set on ensuring inflation stays within the target range.

In light of the cut Mozo launched its RBA Rate Match table, to help borrowers track which lenders have passed on the RBA’s rate cut in full, and which have not.

59% of lenders announce incoming relief 

As of today, a total of 56 lenders out of the 95 Mozo is tracking have announced they are passing the 0.25% rate cut in full to borrowers. Just 39 lenders on the Mozo database are yet to announce.

“Just because the RBA has moved doesn’t mean your lender will, so it will pay to keep an eye on rate movements following the RBA’s decision,” says Wastell.

“Make sure the banks you're considering refinancing to are actually passing on the full RBA rate cuts – because you don’t want to miss out on the best deal just because you haven’t checked your options.”

The dates that lenders will be passing on these long-awaited cuts to borrowers are spread over the next few weeks, with Friday 28 February and Tuesday 4 March being busiest in terms of rate cut deliveries.

Three lenders have already cut rates

Based on the announcements so far, 22 lenders will have passed on the home loan rate cuts next Friday, and another 22 the following Tuesday. The remaining 12 will follow after that between 5 and 12 March 2025.

“The banks have been quick to announce, but the impact of most of those rate cuts will be felt over the next few weeks, rather than immediately,” says Wastell.

Unloan, Athena, and Transport Mutual Credit Union are the only lenders in the Mozo database that have already passed on home loan rate cuts, which shows that a faster response is possible.

“Only three lenders have made the choice to pass on the rate cut within the first week to borrowers, which is disappointing – but highlights the importance of double checking not only if your lender is passing on the rate, but when they’re doing so.”

“For those with a home loan, it’s not just about checking if your lender has passed on the full rate cut – but when. Some banks are delaying mortgage rate cuts by up to two weeks, so if your lender is stalling, it’s worth asking why – and whether you could do better elsewhere. 

Mozo’s RBA Rate Match table tracks which banks are passing on the cut promptly and who’s dragging their feet, so you can decide if it’s time to switch.

You can also keep up to date with rate cut announcements as they happen on Mozo Live.

Banks punish savers before rewarding borrowers

Despite the RBA cutting rates by just 0.25% on Tuesday, some banks are taking even bigger chunks out of savers' interest – but aren’t in a rush to pass on relief to mortgage holders.

While banks were fast to announce home loan cuts, Mozo data shows some banks are moving faster to slash savings rates. In some cases, cutting by more than the 0.25% Reserve Bank of Australia (RBA) cut.

From today, NAB, AMP, Bank of Queensland and ME Bank are cutting deposit rates by up to 0.35%p.a., but the home loan products they have announced they will cut won’t see reductions until at least next week.

“Borrowers might be celebrating the RBA's rate cut, but savers are getting the short end of the stick – again,” says Wastell. “While banks have been quick to slash savings rates, some mortgage holders won’t see relief for weeks.’

“The big question is: if banks can move so fast to cut savings rates, why does it take longer to pass on home loan reductions? The reality is, banks adjust rates in ways that best protect their bottom line – and right now, it’s savers feeling the pinch.”

When it comes to the remaining three major banks, ANZ has yet to announce savings rate cuts, but will be cutting home loan rates on 28 February. Westpac and Commbank have both announced cuts to savings and home loan products.

Westpac is cutting savings rates four days earlier (28 February) than they are cutting home loan rates (4 March). They will cut the Life  savings account by 0.25% and eSaver intro by 0.25%.

Commbank is cutting savings rates on the same day as they are passing on mortgage reductions (28 February). The NetBank saver will be cut by 0.20%, the GoalSaver by 0.25% and base rate by 0.05%.

Cut set to drive refinancing frenzy

After the RBA cut on Tuesday, Mozo has released new research showing the move is likely to drive a refinancing frenzy among Australian mortgage holders, with 49% of mortgage holders telling Mozo they are either considering (35%) or planning (14%) to refinance following a February cut.

According to Mozo’s survey data, 35% of Australian borrowers are now considering refinancing their home loans in response to the February cut, while 14% are definitely planning to refinance. 

When it comes to those not looking to switch up their loans, 47% are not planning to refinance at all, and 4% have recently done so.

Are you planning to refinance your home loan if rates decrease after February 2025?

“Mozo research shows that a significant number of homeowners will be weighing their options carefully following the RBA's rate cut – a clear split in borrower sentiment,” says Wastell.

“But whether you’re looking to refinance now or down the track, it’s crucial to shop around, compare rates, and check if your bank is passing on this RBA cut in full.”

“Remember, the best deal may not always come from your current bank.”

You can read Mozo’s media release here.

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As a part of Mozo’s commitment to making your money count for more, each month we “roundup” the rate changes, key banking trends and money moves in the Australian personal finance market. 

If you’d like to see the analysis in full once it’s released, you can subscribe to receive the Mozo Banking Roundup here.

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