Key Facts

  • BNZ and Kiwibank have followed ASB in cutting their home loan rates.
  • BNZ has cut its six-month and one-year terms by between 5 and 10 basis points, with current rates at 7.24% for six months and 7.14% for one year.
  • Kiwibank has reduced its special six-month fixed rates by 10 points, currently at 7.25% for the special rate and 8.25% for the standard rate.
  • Kiwibank has also dropped its special one-year rate to 6.99%, with the standard one-year rate at 7.99%.
  • In addition, Kiwibank is reducing some term deposit rates by between 5 and 10 basis points.
  • ASB cut several fixed home loan rates by up to 10 basis points last week.
  • Experts anticipate the inflation to fall back into Reserve Bank’s target band within the next year due to an expected cut in rates.
  • A recent survey indicated anticipation of inflation slowing from 3.22% to 2.73% in the next 12 months.

Article Summary

Following ASB, Kiwibank and BNZ have both reduced their home loan rates. Specifically, BNZ has lowered rates for its six-month and one-year terms by 5-10 basis points, bringing them to 7.24% and 7.14% respectively. Kiwibank, on the other hand, has reduced its special six-month fixed rates by 10 basis points to 7.25% for the special rate and 8.25% for the standard rate. Furthermore, Kiwibank’s special one-year rate has dropped by nearly a quarter of a percentage point to 6.99%, and the standard one-year rate is now 7.99%.

In addition to the abovementioned home loan rate cuts, Kiwibank is also lowering some term deposit rates by 5-10 basis points. This follows ASB’s move last week where it slashed various fixed home loan rates by up to 10 basis points. The move is based on industry predictions that inflation is set to fall back into the Reserve Bank’s target band this year if interest rates get a cut.

A recent Reserve Bank survey — comprised of a handful of industry leaders forecasting inflation — anticipates it to slow from 3.22% to 2.73% in the upcoming year. Despite the survey’s small size, the Reserve Bank regards it as a reliable indicator of inflation and interest rate trends. However, experts predict inflation to fall more gradually than the Reserve Bank’s estimation, not expecting rate cuts until early next year.

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