Can Historical Home Loan Interest Rate Data Help you Make an Informed Decision?

In Australia, interest rate decisions are usually undertaken by the Reserve Bank of Australia (RBA). In everyday terms, the RBA’s cash rate, determines the market interest rates that banks set for home mortgages and other loans at any given time.

The financial policy decisions are reviewed by the RBA on a monthly basis. During their latest meeting held on June 7th, the Reserve Bank of Australia left the cash rate unmoved at a record low of 1.75 percent. This decision was pegged on the fact that exports and domestic demand have been expanding at a pace that is above trend. The policy makers also backed this decision saying having the cash rate unchanged this time round is consistent with the inflation returning to target over time and the economy growing in a sustainable way.

Interest rates in Australia hit an all time high of 17.50 percent in January 1990 and a record low of 1.75 percent in May 2016. The interest rate has averaged 4.90 percent between 1990 and 2016.

Historical data has been used by different people to predict various trends over time with investors using it to try and predict share prices while historians have used it to predict future social trends. Can the same be applied to knowing when to lock in your interest rate? Below we look at a chat of RBA’s interest rate dating back to 1990 that we hope will help you make an informed decision.

Interest rate movement since 1990
Date Change in cash rate (Per cent) New cash rate target (Per cent)
3-May-16 -0.25 1.75
5-May-15 -0.25 2
3-Feb-15 -0.25 2.25
6-Aug-13 -0.25 2.5
7-May-13 -0.25 2.75
4-Dec-12 -0.25 3
2-Oct-12 -0.25 3.25
5-Jun-12 -0.25 3.5
1-May-12 -0.5 3.75
6-Dec-11 -0.25 4.25
1-Nov-11 -0.25 4.5
3-Nov-10 0.25 4.75
5-May-10 0.25 4.5
7-Apr-10 0.25 4.25
3-Mar-10 0.25 4
2-Dec-09 0.25 3.75
4-Nov-09 0.25 3.5
7-Oct-09 0.25 3.25
8-Apr-09 -0.25 3
4-Feb-09 -1 3.25
3-Dec-08 -1 4.25
5-Nov-08 -0.75 5.25
8-Oct-08 -1 6
3-Sep-08 -0.25 7
5-Mar-08 0.25 7.25
6-Feb-08 0.25 7
7-Nov-07 0.25 6.75
8-Aug-07 0.25 6.5
8-Nov-06 0.25 6.25
2-Aug-06 0.25 6
3-May-06 0.25 5.75
2-Mar-05 0.25 5.5
3-Dec-03 0.25 5.25
5-Nov-03 0.25 5
5-Jun-02 0.25 4.75
8-May-02 0.25 4.5
5-Dec-01 -0.25 4.25
3-Oct-01 -0.25 4.5
5-Sep-01 -0.25 4.75
4-Apr-01 -0.5 5
7-Mar-01 -0.25 5.5
7-Feb-01 -0.5 5.75
2-Aug-00 0.25 6.25
3-May-00 0.25 6
5-Apr-00 0.25 5.75
2-Feb-00 0.5 5.5
3-Nov-99 0.25 5
2-Dec-98 -0.25 4.75
30-Jul-97 -0.5 5
23-May-97 -0.5 5.5
11-Dec-96 -0.5 6
6-Nov-96 -0.5 6.5
31-Jul-96 -0.5 7
14-Dec-94 1 7.5
24-Oct-94 1 6.5
17-Aug-94 0.75 5.5
30-Jul-93 -0.5 4.75
23-Mar-93 -0.5 5.25
8-Jul-92 -0.75 5.75
6-May-92 -1 6.5
8-Jan-92 -1 7.5
6-Nov-91 -1 8.5
3-Sep-91 -1 9.5
16-May-91 -1 10.5
4-Apr-91 -0.5 11.5
18-Dec-90 -1 12
15-Oct-90 -1 13
2-Aug-90 -1 14
4-Apr-90 -1.00 to -1.50 15.00 to 15.50
15-Feb-90 -0.5 16.50 to 17.00
23-Jan-90 -0.50 to -1.00 17.00 to 17.50