ANZ slashes fixed rates before RBNZ decision next week
ANZ has cut several of its fixed and special home loan interest rates, moving ahead of next week’s Reserve Bank monetary policy statement and prompting predictions that other banks will follow.
Fixed rate specials drop to lowest in years
Effective today, ANZ reduced its one-year fixed rate special by 16 basis points to 4.79% – the lowest since June 2022. It also dropped its six-month fixed rate special to 5.14% and its two-year fixed rate special to 4.89%. The 18-month fixed rate special was cut to 4.79%, while the three-year special fixed rate was left unchanged, 1News and RNZ reported.
Special rates at ANZ are available to customers with a minimum of 20% equity and an ANZ transaction account with salary direct credited.
Standard fixed rates were also adjusted, with the six-month rate now at 5.74%, the one-year and 18-month rates at 5.39%, and the two-year rate at 5.49%. The three, four, and five-year standard rates remain unchanged.
‘More relief’ for borrowers
ANZ managing director for personal banking, Grant Knuckey (pictured), said the changes would provide more relief for both new borrowers and those coming up for refix in what remains a challenging economic climate.
“The cuts provide another opportunity for borrowers not already on fixed rates to take advantage of the falling interest rate environment,” Knuckey said. “For those who are considering locking in a fixed rate, this is something most existing ANZ customers can do themselves in GoMoney.”
Term deposit rates were also lowered by 10 to 15 basis points across most terms, except for the three, four, and five-year rates which were left unchanged.
ANZ takes ‘first mover advantage’
Infometrics chief executive Brad Olsen said ANZ’s move sets a new market benchmark and could spark a competitive response, RNZ reported.
“These new rates from ANZ all look to be the market leading rates for these terms now, and other banks will likely move to regain their competitive position,” Olsen said.
“The cuts look to be in anticipation of the Reserve Bank cutting the official cash rate at next week’s monetary policy statement, with market pricing in a very strong expectation of a cut.”
Olsen noted that ANZ appeared to be factoring in not only the anticipated cut but also the potential for further easing.
“Previously offered mortgage rates would have factored in part of this expected lower OCR, and this cut made today likely factors in the potential for a further cut to the OCR, which is looking more likely as economic data remains weak,” he said.
Markets are currently pricing in a 90%+ probability that the OCR will be lowered to 3% next week, with expectations it could fall to around 2.75% in the first half of 2026.
“ANZ now has the first mover advantage with lower rates,” Olsen said.
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