ANZ Bank is cutting a range of shorter term interest rates. Photo: RNZ / Marika Khabazi
The country's biggest bank is cutting a range of shorter-term interest rates.
ANZ Bank said it would drop its special interest rates by between 15 and 25 basis points.
The six-month rate drops from 6.24 percent to 5.99 percent.
The one-year rate drops from 5.79 percent to 5.57 percent.
The two-year rate drops from 5.59 percent to 5.44 percent.
Standard rates, which are usually available to those without at least 20 percent deposit, drop by a similar margin.
Rates have been trending lower since the middle of last year.
The Reserve Bank is expected to cut the official cash rate again next month.
Reserve Bank data shows the average special rate being taken by New Zealand borrowers on a one-year fix has fallen from 7.3 percent at the peak to 5.78 percent at the end of last year.
ANZ will also reduce its term deposit rates over a number of terms by between 10 and 25 basis points.
David Cunningham, chief executive at mortgage advice firm Squirrel, said the average rate being paid by New Zealanders on their mortgages was still 6.35 percent, up from 3 percent three years ago. He said that had a heavy impact on many households.
But it should unwind over the year, he said, as people refixed. "Assuming that market pricing is accurate and the OCR will be down at 3.25 percent by September, that will almost certainly see mortgage rates for terms out to two years drop to sub-5 percent. That will put about $4 billion back in homeowners' pockets."
He said people were almost always better off fixing rather than floating, on which banks have much higher margins.
BNZ chief economist Mike Jones said 81 percent of mortgages now had less than 12 months until they refixed. "In data going back to 1999, that's only been matched once before, in 2011/12."
He agreed six-month and one-year rates would fall below 5 percent by about the middle of the year.
