World Economy

Europe Banks Slashing Mortgage Rates

Europe Banks Slashing Mortgage RatesEurope Banks Slashing Mortgage Rates

The Australia and New Zealand Banking Group Limited, commonly called ANZ, has slashed its mortgage rates following a similar move by KiwiBank as speculation grows that the Reserve Bank will cut the official cash rate next month.

ANZ’s biggest move was in its 4-year rate, which was fell by 74 basis points from 6.49 percent to 5.75 percent, NewsNow reported.

Its one-year and two-year rates dropped from 5.99 percent to 5.59 percent

KiwiBank has reduced its 6-month offer by 20 basis points to 5.69 percent from 5.89 percent, according to

Craigs Investment Partners analyst Mark Lister said the government’s newly announced tax crackdown on property speculators - combined with Reserve Bank’s moves to combat house price inflation through lending restrictions on property investors - had increased the chances of the official cash rate moving lower.

“I think the chances of that happening have gone up significantly compared with where we were a week ago,” Lister said.

“There’s a whole lot of things that tell us the Reserve Bank should consider cutting the OCR but the big one on the other side is the Auckland property market and I think that’s been the main hurdle [in cutting rates].

“Now that they’re coming up with some other tools, on the Reserve Bank side and the government side, that could open the door to them cutting rates.”

The OCR has major influence on mortgage rates.