Big banks cut rates

Westpac led the five major banks in cutting interest rates on a standard variable mortgage by 0.8% yesterday, following the Reserve Bank's shock move to cut official cash rates by a full 1%, from 7% to 6%.

The rate cut will save the average mortgagee with a $300,000 home loan about $2,000 per year or $168 per month. Economists said the RBA would probably continue to cut rates down to about 5% by mid 2009.