OCR cuts - this year or next?
As the Reserve Bank grapples to get inflation between the 1-3% band, bank economists are split over when the OCR will start dropping.
This week Bloomberg economists said monetary tightening was impacting and cuts could be on the cards in the first quarter of this year as the RBNZ switches from fighting inflation to reviving demand.
However, of the five major banks, the ANZ predicts no rate cuts until February 2025, but cuts earlier cuts to mortgage rates; likewise Westpac; the ASB predicts the first OCR rate in August; the BNZ predicts the OCR will be cut in the third quarter as well as mortgage rates falling and Kiwibank has pushed its OCR rate cut to November along with lower mortgage rates.
The BNZ says the average mortgage rate now is 5.4%. On carded rates, the lowest two year fixed mortgage interest rate is 6.89% - offered by five banks - ANZ, ASB, BNZ, KiwiBank and TSB. The lowest three year fixed rate is 6.75% from ANZ, ASB, KiwiBank, TSB and Westpac.
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