KEY POINTS:
BNZ is dropping its fixed mortgage rates by between 21 and 90 basis points and Kiwibank has joined in, dropping both its fixed and floating rates.
Kiwibank's new floating, or variable, rate is 6.99 per cent. Kiwibank chief executive Sam Knowles said this was a cut of 46 basis points to the lowest rate for variable loans at Kiwibank since May 2004.
The new BNZ rate for two, three, four, five, six and seven year standard fixed home loans is 6.99 per cent.
The rate on the BNZ's GlobalPlus product for two, three and four year mortgages drops to 7.09 per cent. The rates are effective from January 16.
Kiwibank is cutting its two, three, four and five year fixed rates. The new two-year rate is 7 per cent and three, four and five year rate is 7.10 per cent.
Other banks have also dropped fixed mortgage rates this week and late last week.
The moves come after falls on the interest rate swap market in recent weeks from which fixed rate mortgages are priced.
The Reserve Bank of New Zealand is also expected to lower its Official Cash Rate, currently 5 per cent, again on January 29.
Westpac this week predicted that the OCR will be cut several times to a low of 2.5 per cent.
Knowles said the cuts in interest rates were the biggest and quickest for a large number of years and provided significant savings to home loan customers.
New Zealand's largest bank, the ANZ National bank, began the latest round of rate cuts yesterday, taking two year terms down by 0.2 per cent to 7 per cent, while most of its other terms were cut to 7.1 per cent.
- NZPA
