KEY POINTS:
Westpac New Zealand is cutting some fixed home loan rates for the second time in a week and is also cutting its variable home loan rate.
The bank is cutting its variable rate by 66 basis points to 7.49 per cent, effective for new customers on January 20 and for existing customers following notification.
Westpac's variable home loan rate was last at this level in January 2004.
Westpac is also cutting its four and five-year fixed mortgage rates to 6.99 per cent, effective January 19.
"With forecasters predicting a global downturn far worse than the early 1990s and wholesale rates falling in expectation of another cut to the Official Cash Rate (OCR) at the end of the month we are in a position to be able to pass through some relief to our customers," Brian Hayr, head of product management, said.
Swap rates in the interest rate market have been at record lows every day this week, taking the three-year, four-year and five-year swap rate below 4.25 per cent, National Bank of New Zealand said in a commentary today.
Fixed mortgage rates tend to reflect trading in the swap market.
ANZ National, Kiwibank and BNZ have all cut mortgage interest rates this week.
Banking analysts are not calling the cuts a mortgage rate war as the margins that mortgage rates sit above wholesale interest rates such as swap rates remain at high levels. The margin narrowed considerably in previous so-called mortgage wars.
- NZPA
