Treasurer Jim Chalmers has urged banks to pass on the latest interest rate hike to savers without delay.
Dr Chalmers said banks should apply this week’s latest increase in the official cash rate to deposit accounts as quickly as they were passing them on to borrowers.
At its May board meeting, the Reserve Bank lifted interest rates by another 25 basis points, to take the official rate to 3.84 per cent. It was the 11th hike in the relentless tightening cycle targeted at high inflation, which began a year ago.
“The main thing that makes people really unhappy in our community is the sense that interest rate hikes are passed on quite quickly to borrowers and sometimes more slowly to savers,” Dr Chalmers said in Canberra on Thursday.
His comments were in the context of NAB reporting a cash profit jump of 17 per cent, driven by rising interest rates and higher business lending.
NAB was the first big bank to announce it would pass on Tuesday’s 0.25 percentage point RBA hike to both mortgage and savings customers.
Another of the big banks, Westpac, said on Thursday it would follow this week’s 0.25 RBA rise by lifting mortgage rates. Chief executive of consumer and business banking Chris de Bruin said savings rates were also rising.
“We understand cost of living is top of mind for many Australians and to assist our customers manage their money we have several budgeting tools available in the Westpac app and educational resources online through the Master Your Money webpage or via Westpac’s Davidson Institute,” he said.
“We know customers are looking carefully at their budgets as interest rates rise. While many are adjusting to making higher repayments, we understand others may need extra help.”
The consumer watchdog is investigating how banks are treating savers as interest rate settings tighten, with concerns hikes across deposit products have been lower, slower and conditional.
Also on Thursday, fresh Australian Bureau of Statistics data showed the trade balance climbing to $15.3 billion in March from an upwardly revised $14.1 billion in February.
The trade surplus was the second highest on record and above the $13 billion consensus guess.
Exports lifted 3.8 per cent over the month and imports rose 2.5 per cent month-on-month.
The growth in exports was largely driven by an 11.6 per cent rise in iron ore exports and a 10.9 per cent lift in rural goods.
-with AAP
