ANZ became the second dominant bank to raise its lending charges yesterday as it added 20basis points to its standard variable rate.

The rates of the remaining majors of the Commonwealth Bank, which is Australia's biggest lender, and Westpac are being scrutinised and will most likely be lifted this week.

The higher ANZ rates will apply to new and existing variable loans with the bank, and make repayments on the average mortgage of $200,000 nearly $30 a month more expensive.

The rate hikes come as Australian consumers face record petrol prices of $1.50 a litre.

The ANZ hike of 0.2 per cent is nearly double the NAB's 0.12per cent increase of last week and is almost the equivalent of a 0.25 per cent interest rate rise by the Reserve Bank.

ANZ has been the most aggressive bank, last week raising its fixed rate for new loans by a full 25 basis points.

The bank's new standard variable rate of 8.77 per cent is the highest in the market and is at the highest point in more than adecade.

Brian Hartzer, the ANZ's head of personal banking, said that his bank could not afford - despite its $4.18billion profit last year - to absorb the increased funding costs.

"These higher costs have been sustained in 2008 and, given this, we have had to pass on some of the higher costs to home loan customers," he said.

The shift in rates by the major banks comes as the cost of wholesale money on the world markets retreats from the peaks.

Mr Hartzer said the bank promised to reduce its rates when the wholesale markets returned to normal.

The chance of a Reserve Bank interest rate rise in February is lessening, after $30 billion was wiped off the Australian stock market yesterday.