There might be talk about the official cash rate increasing on Wednesday, but another bank has cut home loan interest rates.
ASB has reduced its 18-month fixed home lending rate by 26 basis points from 7.15 per cent to 6.89 per cent, effective immediately.
It says this is the lowest 18-month rate across the major banks.
ASB executive general manager of personal banking Adam Boyd says it will be good news for people wanting to “hedge their bets”.
“Whilst we don’t know the direction of the OCR, wholesale rates remain elevated and the geo-political environment remains volatile. Our 18-month rate may appeal to customers who want to balance security with flexibility.”
The Reserve Bank will review the official cash rate on Wednesday.
Most commentators expect it will be kept at 5.5 per cent but ANZ has forecast a 25bps increase this month and in April.
Both Westpac and BNZ have recently cut rates.
Infometrics chief executive Brad Olsen says the ASB move is less likely to be about the expected track for interest rates and more a commercial and competitive move.
“They’ve only moved the 18-month, none of the others. BNZ moved everything 18-months and above.”
He says ASB is probably trying to appeal to the portion of borrowers who are worried about what might be ahead over the next year and are looking for a slighty longer fix than one year.
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