ANZ will cut the interest rate it charges on its two- and three-year home loans. From Tuesday, the interest rate on its standard two-year home loan will drop 10 basis points to 7.09%. The special rate on that term drops by the same margin to 6.49%. The three -year rate drops by 60 basis points, taking the special to 5.99% and the standard rate to 6.59%.
A number of banks have moved to cut the interest rates charged on longer-term lending in recent weeks. That is despite the Reserve Bank raising the official cash rate (OCR) by 50 basis points at the most recent review, to 5.25%. It is expected to increase it again at the next meeting, to 5.5%.
The bank expressed concern at weakness in the wholesale markets in its most recent update, which it said could lead to lower retail rates, reducing the impact of OCR increases. An ANZ spokesperson said its changes reflected wholesale rate movements and ensure the bank remained competitive.
”All in all, I’d expect any continued near-term cuts in mortgage rates could increase the likelihood of the bank pushing through two more 25 basis point increases to the official cash rate, rather than the single increase that financial markets and most forecasters are anticipating.”
Credit: stuff.co.nz
