RBNZ says rate cuts should act faster this time

“The big thing in terms of the pass-through of lower mortgage rates is to recognise that roughly 70% of mortgages will be repriced over the next nine to 12 months,” Silk said.

“That's significantly greater than we've seen previously. So our expectation is any reduction in mortgage rates from here, or lending rates for businesses, would pass through more quickly than we've seen previously.”

Silk said that while slightly more than a third of New Zealand households have mortgages, those borrowers have higher incomes, meaning they account for between 60% and 65% of total household income.

On Wednesday, RBNZ cut its official cash rate (OCR) to 5.25% from 5.5% previously and has pencilled in at least one more cut this year.