ANZ’s first independent rate announcement this week
(12 January 2012 – Australia) ANZ will be breaking tradition on Friday when it begins monthly announcements of its interest rates, independent of both the central bank and its competitors.
The ANZ's rates verdict will land about lunchtime for the east coast states - (1.30pm, AEDT), the bank is expected to leave rates unchanged, such as its standard variable mortgage rate which is currently at 7.3 percent.
The bank revealed its plan in December to set its own lending rates on the second Friday of each month in a bid to break the public's expectation that it would or should follow in lock-step with the Reserve Bank of Australia (RBA).
Still, investors continue to price in an interest rate cut by the RBA when it resumes its monthly rates decisions on 7 February. Such a move would make it three rate cuts in as many meetings, and heap pressure on all the commercial banks to follow suit - including the ANZ.
The RBA lowered the cash rate twice in November and December - with all but the National Australia Bank among the major lenders to deliver the full 50 basis-point cut to customers.
ANZ chief executive Mike Smith defended his bank's move to go it alone on interest rates by arguing that the RBA's actions only added to the mix of issues it faces in raising funds.
"The change in the RBA's official cash rate is one factor we assess when looking at funding costs," he said in December.
"However, the price we pay for customer deposits, and for the domestic and international wholesale funding that we rely on in order to continue to lend, are much more important considerations."
The bank revealed its plan in December to set its own lending rates on the second Friday of each month in a bid to break the public's expectation that it would or should follow in lock-step with the Reserve Bank of Australia (RBA).
Still, investors continue to price in an interest rate cut by the RBA when it resumes its monthly rates decisions on 7 February. Such a move would make it three rate cuts in as many meetings, and heap pressure on all the commercial banks to follow suit - including the ANZ.
The RBA lowered the cash rate twice in November and December - with all but the National Australia Bank among the major lenders to deliver the full 50 basis-point cut to customers.
ANZ chief executive Mike Smith defended his bank's move to go it alone on interest rates by arguing that the RBA's actions only added to the mix of issues it faces in raising funds.
"The change in the RBA's official cash rate is one factor we assess when looking at funding costs," he said in December.
"However, the price we pay for customer deposits, and for the domestic and international wholesale funding that we rely on in order to continue to lend, are much more important considerations."
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