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Mortgages

Mortgage Rates Daily Commentary
Friday 3 July 2020  Add your comment
TSB makes big rate cuts; Bank profits drop 20%

This morning TSB has made some significant cuts to its home loan lineup. Its 18 month special falls by 30 basis points, and its six-month home loan drops by 40 basis points. See the latest rates here.

With record-low rates and Covid-19 to contend with, bank profits are taking a big hit this year. KPMG's latest report shows profits fell by 20% in the first quarter: [READ ON]

 

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Floating rates won't be rising anytime soon

Floating mortgage rates won't be rising any time soon with Reserve Bank governor Alan Bollard holding interest rates steady and emphasising the uncertain economic outlook means they will stay there for some time.

Thursday, April 28th 2011, 10:59AM

by Jenny Ruth

Bollard left his official cash rate (OCR) unchanged at 2.5%, its lowest level ever. His comments about the high New Zealand dollar being unwelcome saw the currency drop about 0.7 US cents while his comments that inflation will settle comfortably within his zero to 3% band saw wholesale interest rates ease about five basis points.

Bollard's statement "wasn't shy in being dovish," says Craig Ebert at Bank of New Zealand. "They were hardly going to come out and say, we were wrong" and the economy wasn't as bad as expected last month when Bollard cut the OCR from 3% in response to the Christchurch earthquakes.

Nevertheless, Ebert says inflation is unlikely to prove as benign as Bollard currently expects. "They're taking a very cautionary approach and there will be pressure in due course to remove some of this extreme accommodation," he says.

"In six months time there will be evidence that the earthquake hasn't cause a national recession, supply issues will be back on the table and inflation isn't going to fall away."

However, Darren Gibbs at Deutsche Bank says signs of the housing market beginning to revive, particularly in Auckland, and the rebound in business confidence, which some see as signs of inflationary pressures building, won't worry Bollard.

"The Reserve Bank is looking for a strong rebound in economic activity. It would be a worry if the data wasn't picking up," Gibbs says. The data would have to be considerably stronger than currently before the central bank started to worry, he says.

Jane Turner at ASB Bank says Bollard's decision to start raising the OCR again "will be heavily influenced by when the earthquake reconstruction picks up." At this stage, it's still too early to tell when that will happen.

Turner says the statement hasn't changed ASB's view that the OCR is likely to stay where it is until March next year.

« OCR unchanged and likely to stay that way for some timeMystery still surrounds NZF's new equity partner »

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA 4.55 3.19 3.19 3.49
AIA Special - 2.69 2.69 2.99
ANZ 4.44 3.15 3.25 3.85
ANZ Special - 2.65 2.75 3.35
ASB Bank 4.45 3.19 3.19 3.49
ASB Bank Special - 2.69 2.69 2.99
Bluestone 4.44 4.44 4.44 4.44
BNZ - Classic - 2.65 2.69 2.99
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 3.25 3.29 3.59
Lender Flt 1yr 2yr 3yr
BNZ - TotalMoney 4.55 - - -
China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.45 - - -
Credit Union Baywide 5.65 4.75 4.75 -
Credit Union South 5.65 4.75 4.75 -
First Credit Union Special 5.85 3.35 3.85 -
Heartland 3.95 2.89 2.97 3.39
Heartland Bank - Online - - - -
Heretaunga Building Society 4.99 4.35 4.45 -
HSBC Premier 4.49 2.60 2.65 2.80
Lender Flt 1yr 2yr 3yr
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 3.99 2.58 2.68 2.79
Kainga Ora 4.43 3.29 3.39 3.85
Kiwibank 3.40 3.40 3.54 4.00
Kiwibank - Capped - - - -
Kiwibank - Offset - - - -
Kiwibank Special 3.40 2.65 2.79 3.25
Liberty 5.69 - - -
Nelson Building Society 4.95 3.45 3.49 -
Pepper Essential 4.79 - - -
Lender Flt 1yr 2yr 3yr
Resimac 3.49 3.45 3.39 3.69
SBS Bank 4.54 3.29 ▼3.19 ▼3.49
SBS Bank Special - 2.79 ▼2.69 ▼2.99
The Co-operative Bank - Owner Occ 4.40 2.79 2.79 3.39
The Co-operative Bank - Standard 4.40 3.29 3.29 3.89
TSB Bank 5.34 3.59 3.49 3.79
TSB Special 4.54 ▼2.65 2.69 2.99
Wairarapa Building Society 4.99 3.75 3.99 -
Westpac 4.59 4.15 4.09 4.49
Westpac - Offset 4.59 - - -
Westpac Special - ▼2.65 2.69 2.79
Median 4.55 3.22 3.22 3.44

Last updated: 3 July 2020 8:15am

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