ANZ to increase interest rates on some fixed home loans, term deposits

ANZ, a major bank, has announced plans to raise interest rates on certain fixed home loans and term deposits. The bank's managing director for personal banking, Grant Knuckey, attributed the increase to a broad rise in global wholesale interest rates, driven by ongoing uncertainty. Swap rates have climbed from just over 3% at the beginning of July to 3.43% and from 3.36% to 3.7% over the same period.

Knuckey explained that when global uncertainty pushes up funding costs, lending interest rates, including home loans, also increase. He added that ANZ aims to strike a balance between borrowers' and depositors' needs while ensuring that interest rates reflect market funding costs.

For term deposits, ANZ will increase rates by up to 30 basis points for terms extending up to two years. This includes a 3.55% rate for a six-month term, a 4.2% rate for an 18-month term, and a 4.3% rate for a two-year term.

Fixed home loan rates will see an increase ranging from 10 to 26 basis points across various terms. For instance, a six-month loan will rise by 10 basis points to 4.79%, a one-year loan by 20 basis points to 4.99%, an 18-month loan by 26 basis points to 5.45%, a two-year loan by 20 basis points to 5.49%, and a three-year loan by 10 basis points to 5.59%.

According to recent insights from ANZ economists, a one-year fixed home loan might currently be cheaper than a two-year fix. The bank holds a significant portion of home loan customers who are ahead by at least six months on their repayments.