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Mortgage Rates Daily Commentary
Wednesday 23 July 2014  Add your comment

PS: Yesteday's headline was possibly an over-reaction to the RBNZ speech.

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RB leaves rates unchanged

As expected, Reserve Bank governor Don Brash left the official cash rate (OCR) unchanged at 5.75%, acknowledging both the strength of the domestic economy and the worsening outlook for the global economy.

Wednesday, August 15th 2001, 9:45AM

by Jenny Ruth

As expected, Reserve Bank governor Don Brash left the official cash rate (OCR) unchanged at 5.75%, acknowledging both the strength of the domestic economy and the worsening outlook for the global economy.

Brash says underlying inflation remains well within his zero to 3% target range and that the headline inflation rate, the consumer price index (CPI), should also move back towards the middle of that range by the middle of next year. The CPI rose 3.2% in the year ended June.

Nevertheless, that are risks to that "relatively benign" assessment, Brash says.

"Inflation could turn out to be more persistent than currently seems likely. There are an increasing number of indicators suggesting that the economy may be operating slightly above full capacity," he says.

If the CPI stays close to 4% there’s a risk inflation expectations may go up, "leading to adverse consequences for wage- and price-setting," he says.

Brash says businesses are confident about the outlook for their own activity, rural sector incomes are at their highest level in many years, employment intentions are at near-record levels, and there are strong signs of a pick-up in both confidence and activity in residential construction. That was previously one of the most sluggish parts of the economy, he says.

Given those factors, "we have no reason to date to regret the relatively cautious manner in which we have reduced the OCR in recent months."

If it weren’t for the risk that the international environment will turn out to be even weaker than assumed, "the current situation would point to an early increase in the OCR," Brash says.

"The flow of economic indicators from the United States, Japan, non-Japan Asia and Europe makes a deeper and more prolonged slowdown seem quite likely,’’ he says.

If that happens "there seems little doubt that the dis-inflationary pressures on New Zealand coming from overseas would intensify. As a result, inflation could fall into the bottom half of our target range and this would necessitate further easing of monetary policy."

Brash’s rhetoric surprised no one. The key 90-day bank bills, from which floating mortgage rates are set rose from 5.82% late yesterday to 5.83%.

« Ombudsman sees few mortgage broker complaintsHousing sales and prices dip in July »

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AMP Home Loans 6.99 5.99 6.29 6.60
AMP Home Loans $200k+ 6.89 5.89 6.19 6.50
AMP Home Loans LVR <80% - - 5.85 6.29
ANZ 6.49 6.05 6.49 6.65
ANZ LVR > 90 6.49 6.55 6.99 7.15
ANZ Special - - 6.09 -
ASB Bank 6.50 6.09 6.40 6.65
ASB Bank Special - 5.95 - -
BankDirect 6.50 6.09 6.99 6.65
BankDirect Special - 5.95 - -
BNZ - Classic - - - 6.25
Lender Flt 1yr 2yr 3yr
BNZ - GlobalPlus 6.49 5.99 6.39 6.59
BNZ - Mortgage One 6.90 - - -
BNZ - Rapid Repay 6.49 - - -
BNZ - Std, FlyBuys 6.49 5.99 6.39 6.59
BNZ - TotalMoney 6.49 - - -
Credit Union Auckland ▲6.70 - - -
Credit Union Baywide 6.10 5.90 6.50 -
Credit Union North 6.45 - - -
Credit Union South 5.75 - - -
eMortgage 6.04 6.15 6.69 7.19
Finance Direct 6.10 6.45 6.69 7.10
Lender Flt 1yr 2yr 3yr
First Credit Union 6.45 - - -
General Finance 5.95 6.25 6.50 7.10
HBS Bank 6.15 5.85 6.20 6.25
HBS Special - - - 5.95
Heartland 6.45 6.75 7.00 7.60
Heretaunga Building Society 6.25 5.85 6.50 -
Housing NZ Corp ▲6.50 ▲6.00 6.30 ▲6.60
HSBC Premier 6.59 5.95 5.99 6.25
HSBC Premier LVR > 80% - - - -
HSBC Special - 5.85 5.85 5.85
Kiwibank 6.40 5.99 6.29 6.29
Lender Flt 1yr 2yr 3yr
Kiwibank - Capped 5.65 6.50 - -
Kiwibank - Offset 6.30 - - -
Kiwibank LVR > 80% - - 5.85 6.29
Liberty 5.64 - - -
Napier Building Society 5.80 6.00 6.70 -
Nelson Building Society 6.75 5.95 6.60 -
NZ Home Loans 6.35 6.09 6.40 6.65
Perpetual Trust 7.70 - - -
RESIMAC - lo doc 7.34 7.06 7.38 7.82
RESIMAC LVR < 80% 6.34 6.06 6.38 6.82
RESIMAC LVR < 85% 7.34 7.06 7.38 7.82
Lender Flt 1yr 2yr 3yr
RESIMAC LVR < 90% 8.34 8.06 8.38 8.82
SBS Bank 6.15 5.85 6.20 6.25
SBS Bank Special - - - 5.95
Silver Fern 5.95 6.10 6.55 7.05
Sovereign 6.60 6.09 6.40 6.65
Sovereign Special - 5.95 - -
The Co-operative Bank 6.45 6.00 6.00 6.25
TSB Bank 6.49 6.00 6.19 6.60
TSB Special - - 5.80 -
Wairarapa Building Society 6.20 5.75 5.95 -
Westpac 6.24 6.09 6.39 6.65
Lender Flt 1yr 2yr 3yr
Westpac - Capped rates - 6.49 6.99 -
Westpac - Offset 6.24 - - -
Westpac Special - 5.95 - -
Median 6.45 6.00 6.39 6.60

Last updated: 18 July 2014 9:08am

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