Following Monday’s announcement, NAB’s lowest fixed rate is now 5.84 per cent, available for owner-occupiers paying principal and interest with a deposit of at least 20 per cent on a three-year term.

Canstar data insights director Sally Tindal said with NAB cutting rates others were likely to follow.

“The cost of wholesale fixed rate funding has started to ease slightly. This, combined with a prospective cash rate cut, should push other banks into moving on fixed rates,” she said.

“While a few banks are now starting to sharpen their offerings, fixed rates still have a way to fall before they become fashionable again with borrowers.”

NAB’s move comes before the RBA meeting on February 17-18 when the board is largely expected to cut the official cash rate from 4.35 per cent to 4.10 per cent.

Last week, NAB became the last of the major banks to call an interest-rate cut when the central bank meets in February.

“We now expect the RBA to cut the cash rate by 25 basis points in February,” NAB chief economist Alan Oster wrote in a note.

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