Don't expect rates to fall on back of OCR cut

While the banks have been silent, BNZ did put out a statement confirming it would not cut its rates. Westpac followed late on Thursday.

“We are not making any changes to interest rates today," BNZ acting director of retail and marketing David Bullock said.

"It’s a good time to remind people that interest rates aren’t directly or solely linked to the OCR. Banks get their ability to lend from a few sources, most of which are getting more expensive and putting pressure on margins.

"One source is local deposits, and at the moment there are more people wanting home loans than there are people saving. So to encourage and attract more deposits (people’s savings and terms deposits) we need to pay a sharper return to savers. And we still need overseas funds to fill the gap – and the cost of these remains volatile.