Borrowing costs to banks unusually high at the moment
One of the more interesting things in the wholesale money markets at the moment is that swap rates have risen so far they imply an...
Monetary policy to tighten before it loosens again
the fixed rate costs to banks of borrowing money to lend at fixed interest rates have soared in recent weeks. That is why we are s...
Interest rate rises to continue this year
Welcome to my first fortnightly column on mortgage rate levels and prospects in New Zealand. At the start of 2022 we can see that all fixed interest rates have in fact risen quite firmly.
Monetary policy tightening already in place
Over nearly 3 years the OCR increased from 5.0% to 7.25%. But the 3-year fixed mortgage rate barely increased. Contrast that with the current situation of this rate rising 1.8% the past six months while the Reserve Bank’s cash rate has gone up only 0.5%.
Fixed rate hikes reflect market expectations
Mortgage interest rates have now risen by between 1.3% and 1.8% from where they were less than six months ago as banks have reacted to sharp increases in their cost of funds.
Interest rates on an upward march
The long-awaited monetary policy tightening cycle has now kicked off in New Zealand as the need for record low interest rates to combat feared effects of Covid-19 has disappeared, and the need to fight rising inflation has soared.