ANZ, BNZ lower mortgage rates

Wednesday, 22 January 2025

ANZ had cut its six month standard and special fixed mortgage rates both by 25 basis points.

Ahead of the latest quarterly inflation data, two major banks cut their mortgage rates as competition heats up.

The Consumers Price Index (CPI) data released by Stats NZ on Wednesday showed inflation had increased 2.2% in the December 2024 quarter, compared with the same quarter in 2023.

Earlier, ANZ cut its six month standard and special fixed mortgage rates both by 25 basis points.

The one year rate has been lowered 22bp to 5.57%, while the 18-month standard and special rates both dropped 20bp to 5.99% and 5.39% respectively, while the two-year rates dropped 15bp to 5.44%.

Lloyd Burr explains why there's always a difference between the Official Cash Rate (OCR) and the mortgage rates banks charge us.

BNZ also reduced some of its interest rates on Wednesday, trimming 0.2% off its standard one-year and 18-month fixed rates, taking them to 5.59% and 5.39% respectively.

The bank also cut its standard two-year fixed rate by 0.3% to 5.29%.

The latest cuts come after banks began lowering mortgage rates early last week as inflation was predicted to reach its lowest level in four years.

Westpac was the first to lower its advertised special 6-month home rate by 0.20% per annum to 5.99% p.a. and its standard 6-month rate by 0.20% to 6.59% on January 17.

ASB then followed, lowering its fixed home lending rates, with the 1-year term dropping 20bp from 5.79% to 5.59%, while its 18-month term also dropped 20bp to 5.39%

Economists were predicting the Official Cash Rate, which effects what we pay for our mortgage, will continued to be cut this year.

Reaching a high of 5.5% in July, three consecutive cuts reduced the OCR to 4.25% when it was last reviewed by the Reserve Bank in November.

It was expected the OCR would be cut by a further 25 to 50 basis points in February.