Australia's competition regulator has been directed by the
country's federal government to investigate how banks set
interest rates for deposits and home loans, the Australian
Competition and Consumer Commission (ACCC) said on Wednesday.
The Reserve Bank of Australia (RBA) has raised its cash rate by a total of 325 basis points since May last year in a bid to curb inflation. It recently upped the rate again to a decade-high of 3.35%. Most banks in the country, including the so-called "Big Four" banks - Commonwealth Bank of Australia , National Australia Bank , Westpac Banking Corp and ANZ Group Holdings have passed on the higher mortgage rates to their consumers in full.
The ACCC, however, noted that the "increases in interest rates on deposit products appear to have typically been smaller and less consistent." In many cases, banks have only applied increases in the cash rate to some of their deposit products, often with conditions attached, they said.
The RBA's aggressive policy tightening campaign has impacted
economic growth, added to cost of living pressures, and sharply
cooled the housing market, with data from CoreLogic showing
prices have declined 9% since April.
(Reporting by Harish Sridharan in Bengaluru; Editing by Dhanya
Ann Thoppil and Nivedita Bhattacharjee)
