The Westpac Weekly Commentary says recent comments from the RBNZ strongly hint that it is leaning towards moving "late and hard". This would put it at odds with other central banks favouring a more pre-emptive approach, particularly with policy rates still at "emergency settings".

"The Reserve Bank of Australia (RBA) and Norges Bank have begun raising rates on this basis, European Central Bank officials have commented on the need to act early, and there's even speculation that the Fed will look at rewording its commitment to low rates at this week's review," it says.

Westpac believes that the RBNZ will have started moving rates by March and also comments that with six-month fixed mortgage rates having now risen, there is now no point on the mortgage curve that appears to be "safe".

The RBNZ's statement last week validated the ANZ/National Bank economists' view that the market is premature in pricing in tightening from early next year, this week's Market Focus says.

"The market has pushed the timing of the rate hike to March, which is still too early in our view, and we see scope for further rallies in the March bank bills and for the curve to steepen," it says.

The ASB economists are sticking to their belief that the first Official Cash Rate (OCR) hike will be in April and that the hiking cycle, once it starts, will be relatively aggressive. It predicts the first three moves will be rises of 50 basis points.

In its Business Weekly report it says its calculations reveal that any option from floating through to the two-year fixed rate will result in around the same average cost of funds for mortgage borrowers over the next two years.

"Consequently it is now a tough call whether remaining floating, or opting for the shorter fixed terms will give the lowest cost of funds over the next two years," it says.

As a result, other factors such as a desire for flexibility, or alternatively a need for certainty and stability around debt servicing costs are likely to play a bigger role in borrower decision making.

The BNZ Capital Markets Outlook predicts the first rate hike will take place about June next year.

"When the Bank gets going it will be a steady stream of tightening in its first phase - potentially chunky in parts - rather than being tentative and stop-start in nature," it says.