Don't bank on mortgage rate cuts

Even if the RBA cuts interest rates this year as expected, banks won't follow suit with mortgages because the composition of their funding costs has changed dramatically.

Amidst all the smoke generated by the interest rate battle between the big banks and the government, Bendigo Bank chief executive Mike Hirst in his KGB interview details a major change in the component costs of bank funding. As a result, those expecting big mortgage rate falls are likely to be wrong.

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