“We know there are many New Zealanders looking to refix their mortgage or take on the significant title of homeowner this year, and we’re pleased to support them with lower rates.”
ASB is also cutting its longer-term home loan rates, with its three-year offering dropping 6bps to 5.09% and its four-year term decreasing 10bps to 5.49%.
ASB said it would also be reducing some term deposit rates by between 5 and 20bps.
The latest round of mortgage rate cutting comes in the wake of the Reserve Bank’s (RBNZ) latest Official Cash Rate (OCR) cut at the end of May.
The OCR was cut by 25bps to 3.25%.
The OCR has fallen 225bps since August last year, when it was sitting at 5.5%.
Last week, BNZ cut its mortgage rates for the second time in three weeks.
The bank’s one-year fixed home loan rate fell from 4.95% to 4.89%. Its six-month rate was cut by 6bps to 5.29%.
Lower global growth projections have raised expectations that the RBNZ will have to cut the OCR to a lower level than was forecast in February.
At the time, the RBNZ was projecting a pause at 3.25%, with the prospect of cutting to 3% by the end of the year.
Since then, commercial bank economists’ forecasts have shifted to a low point of 2.75% or 2.5% by the end of the year.
The RBNZ will make its next OCR decision on July 9.
