BNZ has cut some of its short-term mortgage rates to offer the equal lowest lending terms on the market among the major banks. 

The bank said from today, its one-year fixed home loan rate would drop from 4.95% to 4.89%. 

Its six-month rate would drop 6 basis points (bps) to 5.29%. 

Both BNZ and Westpac now have the lowest six-month and one-year fixed rates among the big five lenders. 

BNZ cut both rates on the eve of the Official Cash Rate (OCR) decision, just over three weeks ago. 

The Reserve Bank (RBNZ) cut the OCR by 25bps to 3.25%. 

Since the OCR drop, all major banks have been lowering their fixed lending terms. 

Last week, Westpac cut its six-month special rate by 20bps to 5.29% and its one-year special rate by 6bps to 4.89%. 

ASB and ANZ both have an 18-month fixed mortgage rate of 4.89%, the lowest it’s been since April 2022. 

Earlier this month, ASB dropped its six-month rate by 14bps to 5.45% and its one-year offering was cut by 4bps to 4.95%. 

ANZ reduced its six-month special and standard terms by 20bps to 5.29% and 5.89%, respectively. ANZ’s one-year special is also 4.95%. 

Cameron Marcroft, senior adviser and director at Loan Market, previously told the Herald it felt like we were nearing the bottom of the interest rate cycle. 

“We’re into the 4.8s now for those shorter-term rates… I don’t see much [lower] than that,” he said. 

Marcroft said one and two-year rates had probably been more popular lately, while the three-year rate had become “semi-attractive” for some borrowers. 

“Getting stability in your borrowing is really important right now.” 

Lower global growth projections, based on trade disruptions, have raised expectations that the RBNZ will have to cut the OCR to a lower level than was forecast in February. 

At the time, the RBNZ was projecting a pause at 3.25%, with the prospect of cutting to 3% by the end of the year. 

Since then, commercial bank economists’ forecasts have shifted to a low point of 2.75% or 2.5% by the end of the year.