In the latest Weekly Overview, Alexander says the RBNZ have made it clear they will keep floating rate borrowing costs as low as possible, for as long as possible.
"Though we see little chance they will be able to keep the 2.5% Official Cash Rate in place until the latter part of 2010' as they have repeatedly stated", he says.
Alexander expects the RBNZ to move in July next year at the latest.
"But the quicker the Australians move the sooner a rate rise here is likely," he adds.
For borrowers fixed rates will continue to creep higher, while floating rates will start rising about 3% from mid-next year at the latest, Alexander says.
"I'd now probably float and go for the ride given both the leap higher to fixed rates and the fact fixed rates from four years on are now about their five year averages."
