BNZ has confirmed it is raising rates on shorter fixed-term mortgages while trimming rates further out on the curve, a split decision that tells homeowners everything they need to know about where this is all heading.
Effective today, June 24, the bank lifted its standard 6-month rate from 4.49% to 4.69%. The 1-year and 18-month rates each climbed 0.14%, landing at 4.79% and 5.09%, respectively. The 2-year fixed rate rose from 5.19% to 5.29%.
Meanwhile, the longer-term rates — 3-year, 4-year and 5-year — were cut by between 0.10% and 0.30%. The 3-year rate now sits at 5.29%, the 4-year at 5.39%, and the 5-year at 5.49%. As always, borrowers with less than 20% equity in their property will be slapped with a low equity premium on top.
This comes just days after the country’s largest bank, ANZ, moved to cut some of its own fixed home loan rates, citing a drop in wholesale rates. ANZ managing director for personal banking Grant Knuckey credited the shift to international developments: “Global events continue to influence wholesale rates, which have come off a little as the US enters peace talks with Iran.” Westpac NZ made a similar move last week, also trimming some of its home loan rates.
But don’t let the short-term relief fool anyone. The Reserve Bank held the Official Cash Rate at 2.25% in its May 28 review and signalled that further hikes were “very likely” on the way. The next OCR call lands July 8, and banks like BNZ are clearly positioning their books accordingly.
For everyday Kiwi families already squeezed by years of cost-of-living pressure, the message from the banks is unmistakable: enjoy the long-term discounts while they last, because the short end of the curve is where the real signal lies and it’s pointing up.