Long term fixed rates slashed

Twelve lenders dramatically reduced their long-term fixed rates between two to five years over the last week with four lenders dropping their five-year rate by more than 70 basis points.  

Thursday, July 8th 2010, 12:15PM

We have a graph showing the changes in five-year fixed rates over the last year, with current rates back where they were 12 months ago.

Kiwibank led the charge in dropping the two-year rate last Thursday, cutting it from 7.30% the median for all banks, to 6.99%. Most of the other banks followed suit and now the median for the banks has also dropped to 6.99%.

In news, the Reserve Bank of New Zealand should stop raising interest rates, amid worrying evidence that the economic recovery is stalling, says New Zealand Institute of Economic Research economist Shamubeel Eaqub.

In Expert Views BNZ economist Tony Alexander believes there's a risk with the patchy recovery that the Reserve Bank will not raise the cash rate as quickly as BNZ has pencilled in.

ANZ says fixed mortgage rates are lower, but the curve is still steep, making fixing still the more expensive option.

Comments from our readers

No comments yet

Add your comment: