by Paul McBeth
The National Bank is making a lone stand on its floating mortgage rate, while all the other main trading banks fall into line with an increase.
Bank of New Zealand lifted its rate from 6.50 per cent to 6.75 per cent a week ago, trumpeting the effects of sustained higher wholesale rates. The others eventually followed, with the latest - ASB Bank - lifting its rate yesterday.
However, the National Bank has stuck to its own tradition of holding out on the other main banks for as long as possible (for details of the rates moves, see our table. Note that the other lenders have floating rates ranging from 5.85 per cent to 6.50 per cent, with the likes of TSB Bank and AMP Banking below the trading banks at 6.25 per cent).
The National Bank's Chief Executive Sir John Anderson said this morning that the bank had no imminent plans to increase the floating rate. "There are a number of economic factors that impact rates that are not yet certain."
However, that uncertainty won't be there much longer, as impending economic figures put even more upwards pressure on mortgage rates. The September quarter consumer price index will be announced on Friday: bank forecasts have put this at 0.7 to 0.8 per cent (less the effect of interest rates) and so marking the start of higher inflation.
Added to that, the next review of the Official Cash Rate (OCR) is now just three weeks away. A key influence on floating rates, this has been stable since its introduction in March but could increase at this review by as much as 0.5 percentage points to 5.0 per cent.