Key Facts

  • ASB has reduced its mortgage rates, lowering its two-year rate from 7.05 percent to 6.89 percent and its three-year rate to 6.75 percent.
  • The bank has also reduced some of its long-term deposit rates.
  • These changes, as explained by Spokesperson Adam Boyd, reflect the recent fall in wholesale prices.
  • ASB’s new home lending and term deposit rates took effect from Friday.
  • BNZ and ANZ also reduced their rates earlier, due to a decrease in wholesale rates.
  • In November, the Reserve Bank maintained the official cash rate at 5.5 percent, unchanged since May.

Article Summary

New Zealand’s ASB bank has announced a reduction in its mortgage rates, with the two-year rate seeing a decrease from 7.05 percent to 6.89 percent, and the three-year rate dropping to 6.75 percent. The bank has also revised downwards some of its long-term deposit rates. The changes, according to ASB spokesperson Adam Boyd, are a response to the recent fall in wholesale rates.

ASB is not the only bank making adjustments in its rates. Earlier, BNZ and ANZ also reduced their standard fixed and special mortgage deal rates respectively. These changes were also motivated by the reduction in wholesale rates that contribute to a portion of the banks’ lending.

The Reserve Bank of New Zealand, meanwhile, decided to keep the official cash rate at 5.5 percent in November. This rate has remained unchanged since May. The Reserve Bank cited slowing inflation impacted by successive rate hikes as a significant reason, while noting that inflation was still above the desired level.

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