Should I fix interest rates

I have a 170k variable investment home loan with macq. The current rate is 2.49 perc and I have the option to fix it at 2.99 for 2 years.

At maximum I would have 70k sitting in the offset within 2 years.

Would you guys suggest i fix 100k, at 2.99% for 2 years?
The only reason for me doing this is to try to come out ahead and pay less interest in the long run.
Interest rates are forecasted to increase this year and next year, so it might be wise to lock in a fixed, even if it higher than the current variable.
However the banks have possibly already price the future cash rate rises into the fixed rate.

Prehaps fixing is just a gamble and best to stick with variable?

 

For you to come out ahead over 2 years, rates would need to steadily increase to 3.5% or more over that time. Do you believe this is going to occur?

Fixed rate increases are currently being driven by international bond markets. They're not directly tied to variable rates. Variable rates are the lowest they've ever been, it seems logical that they can only go up. When, how much, how quickly is anyone's guess. Fixed rate increases are an indicator of what the variable rates will do, but it's only a loose relationship. It's quite possible they could go up in a month or two, or it could be next year.

The best economists rarely make accurate rate predictions more than a few months in advance. The only thing I know for sure about rates is to make your best judgement and be prepared to live with it.