Kiwibank, BNZ drop mortgage rates

By earthnews
2 months Ago

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Kiwibank, BNZ and ASB have recently dropped their mortgage rates.
Photo: RNZ

Kiwibank and BNZ are the latest banks to cut home loan rates, following ASB.

BNZ has cut its six-month and one-year terms by between 5 and 10 basis points.

They stand at 7.24 percent for six months, and 7.14 percent for one year.

Kiwibank is cutting its special six-month fixed rates by 10 basis points to 7.25 percent for the special rate and 8.25 percent for the standard rate.

The special one-year rate is falling by about a quarter of a percentage point to 6.99 percent, while the standard one-year rate has fallen to 7.99 percent.

Kiwibank is also reducing some term deposit rates by between 5 and 10 basis points. Its one-year rate for more than $10,000 is 5.90 percent, and under that is 5.80 percent.

Last week, ASB dropped several fixed home loan rates by up to 10 basis points.

It comes as industry leaders are picking inflation to fall back into the Reserve Bank’s (RBNZ) target band in the coming year, with expectations that the central bank may cut interest rates by the end of this year.

A quarterly survey of a handful of forecasters and company heads – commissioned by the RBNZ – showed expectations were for inflation to slow from 3.22 percent to 2.73 percent in the next 12 months, the lowest pick since September 2021.

Despite its small number of respondents – just 37 – the RBNZ regards the survey as a credible steer on opinion, when looking at inflation and interest rates.

Westpac senior economist Satish Ranchhod said the RBNZ would get a fillip from the survey that showed its policy was working, but inflation was stubborn as demonstrated in figures released on Monday.

“While today’s fall in inflation expectations will help to quell concerns about the persistence of domestic inflation, we still think that inflation will fall more gradually than the RBNZ has assumed. Consistent with that, we’re not forecasting rate cuts until early next year.”

The RBNZ reviews the OCR next week, with expectations it will be held at 5.5 percent.