VIEW: After Westpac's mortgage rate move late...>

RBA: VIEW: After Westpac's mortgage rate move late Wednesday BNP Paribas noted

that "Westpac becomes the first of the majors to increase mortgage rates in the

face of higher funding costs. We have noted the relationship between BBSW-OIS

spreads and mortgage rates previously with mortgage rates tending to lag

persistent increases in BBSW-OIS by around 6 months. We expect the others to

follow suit as we approach financial year end for 3/4 majors end Sep. BBSW-OIS

has remained historically elevated this year and is weighing on banking sector

NIMs as highlighted by Westpac's update last week (NIM dropped 11bp with 5bp due

to higher BBSW). Whilst there is nothing priced in as far as the eye can see in

rates markets in terms of the RBA, further out of cycle hikes by the banks will

only delay further the start of the RBA's tightening cycle."