ASB lowers rates, broker expects more cuts to come

ASB is the latest bank to cut home loan rates. Photo: RNZ / Dom Thomas

ASB is the latest bank to cut home loan rates, reducing its one-year rate by five basis points to 5.49 percent.

Its 18-month rate drops from 15 basis points to 5.19 percent, with the six-month rate dropping 10 basis points to 5.89 percent.

ASB executive general manager Adam Boyd said the changes would be welcome for home loan customers, and those looking to refix or buy.

"We've lowered rates across several terms three times in the past month, giving our customers and prospective buyers a range of options, whether they're after short-term relief or longer-term certainty," he said.

"We already know how popular the short-term rates are and we've seen growing interest in the 18-month term this year," he said. "Competition is fierce when it comes to interest rates and we're pleased to be offering lower mortgage rates for New Zealanders."

ASB has also reduced some of its term deposit rates.

Since Friday, Westpac has offered a 4.99 percent rate for three years.

Loan Market mortgage adviser Karen Tatterson said she had not seen banks match that rate yet, but BNZ had dropped its two-year rate to 5.09 percent, probably in competition.

Edge Mortgages director Glen Mcleod expected more rate movements in coming days, with the official cash rate (OCR) announcement looming.

"It is going to be very interesting to see how the rate changes develop over the next few days, as the announcement gets closer. The fight between sticky inflation and a struggling economy makes this time around very interesting."