BNZ lifts floating mortgage rate

Floating mortage rates are on the rise again, with the Bank of New Zealand leading the way.

The BNZ is increasing its variable home mortgage rate by 25 basis points to 7.75 per cent following the Reserve Bank's decision to raise the official cash rate last week.

The RB increased rates by 25 basis points to 5.50 per cent in response to concerns that strong growth in the domestic economy would spur inflation.

BNZ is the first of the five main retail banks to increase lending rates since last week.

Its new rate will be effective immediately for new customers and from June 5 for existing customers.

- NZPA