Banks Are Cutting Fixed Rates — Without an RBA Cut. Here's Why.

Here's something that trips a lot of people up: the RBA held the cash rate at 4.35% in June, and it's on hold again until the next decision on 11 August. Yet if you've looked at fixed home loan rates in the past few weeks, several lenders — including Macquarie, NAB, ANZ and ING — have been cutting them. Not by huge amounts, but consistently, and in the opposite direction to where the cash rate has been heading in 2026. It's a fair question: if the RBA isn't cutting, why are the banks?

What's actually moved

The past few weeks of lender pricing tell a consistent story. Macquarie Bank made the boldest move, trimming fixed rates by up to 0.50 percentage points, taking its best advertised rate to 6.09% p.a. NAB followed with cuts of up to 0.20 percentage points on its one and two-year fixed products. ANZ and ING both moved by similar margins on selected fixed terms. Westpac has been the outlier, nudging some rates slightly higher in line with its more hawkish call on where the cash rate is headed next.

Most major and non-major lenders trimmed fixed rates in July 2026, while Westpac moved the other way.

Canstar's weekly rate tracking backs this up at a broader level too: no lender lifted rates in the seven days to 19 July, while eight lenders trimmed fixed or variable pricing. That takes the running total of lenders cutting variable rates since the RBA's most recent hike to 23.

Why cut now, with rates on hold?

A few things are going on at once, and none of them require the RBA to actually cut the cash rate:

• Competition for a shrinking pool of borrowers. National home values fell in June at the fastest monthly pace since late 2022, with Sydney and Melbourne going backwards. Fewer transactions means fewer new loans to compete for, so lenders are sharpening pricing to win the borrowers who are still active — rather than reflecting any softening in the RBA's own stance.

• Fixed rates price in future expectations, not today's cash rate. Unlike variable rates, which move directly with RBA decisions, fixed rates are set on where a lender expects the cash rate to be over the fixed term. Some lenders are positioning for rate relief further down the track, even with the near-term outlook for the cash rate still described by several bank economists as "higher for longer."

• A play for new-to-bank customers ahead of spring. Cutting fixed rates is a well-worn way to win new business without touching the back book of existing variable-rate customers, and lenders typically sharpen pricing ahead of the traditional spring selling season.

It's worth noting the split in outlook driving this: NAB is forecasting one more 25 basis point cash rate rise in August, Westpac's economists are calling for two more hikes, while ANZ and CBA expect no further increases this year. That range of views is part of why lender pricing looks inconsistent right now — different banks are betting on different paths.

The cash rate has been flat since May, while fixed rate pricing has continued to drift down.

What it means for you

A few practical takeaways if you're weighing up your options right now:

• Don't read falling fixed rates as a signal the RBA is about to cut. They're a separate signal, driven by lender competition and medium-term positioning — not confirmation of where the cash rate is headed on 11 August.

• If you're comparing fixed vs variable, the gap between the two has narrowed in recent weeks. That's worth factoring in if certainty of repayments matters to you, particularly heading into a period where the RBA's own language has stayed fairly hawkish.

• If you're refinancing, remember that serviceability assessment still applies at your rate plus the 3% APRA buffer, regardless of how attractive the advertised fixed rate looks. A lower fixed rate doesn't automatically mean a lower serviceability bar to clear.

• Timing matters more than headline chasing. The lowest fixed rate on the market today may not be the lowest rate you're eligible for once LVR tier, loan purpose and lender-specific policy are factored in.

If you want to know where you'd actually sit — fixed, variable, or a split — against current lender pricing and your own numbers,

and I'll talk you through what fits.

This article is general information only and does not take into account your personal financial situation, objectives or needs. Interest rates, lender policies and RBA cash rate decisions are subject to change — figures quoted are accurate as at the date of publication. Ian Freeman Finance | Credit Representative Number 439731 of Australian Credit Licence 384704.