Hi Guys
Interesting article on stuff this morning.
Westpac bumps up mortgage rates
17 November 2003
By JAMES WEIR
Westpac is the first of the big banks to lift floating mortgage interest rates, in a move likely to spark a round of small rate rises.
Westpac bumped up its floating rate from 7.1 per cent to 7.25 per cent because of rising wholesale interest rates. On a $150,000 mortgage, the increase meant an extra $6.67 a fortnight.
A Westpac spokesman said the bank was "passing on some of the recent increased cost of funds".
The floating rate was set at 7.1 per cent when the 90-day bank bill rate was just 5.05 per cent, but that has recently moved up to 5.42 per cent.
Westpac also lifted some deposit rates.
The Reserve Bank's official cash rate, a prime influence of floating mortgage rates, is predicted to rise to 5.25 per cent as soon as next month. It may go to 6 per cent next year, taking floating mortgage rates to more than 8 per cent.
Short-term interest rates moved up sharply in the last fortnight, particularly after strong job market figures last week, showing unemployment at a 16-year low of 4.4 per cent.
The low jobless rate and strong retail spending figures increased the chances that the Reserve Bank would lift the official cash rate by 25 basis points to 5.25 per cent on December 4.
However, Reserve Bank governor Alan Bollard will have to balance the impact of a rising New Zealand dollar - now above US63 cents - which will dampen inflation by reducing the cost of imports.
While Westpac moved on floating rates, it held its fixed-term loan rates steady. Last week, both ANZ Bank and KiwiBank moved up to Westpac's fixed rates level.
Since its launch, KiwiBank has been significantly undercutting the big banks, offering lower interest rates on home loans. KiwiBank's floating rate remains the cheapest in the market at 6.55 per cent.
But last week's move puts KiwiBank's fixed-term rates for one to five years, just 5 basis points, or 0.05 per cent, below most of the big banks and higher than some
Regards
Interesting article on stuff this morning.
Westpac bumps up mortgage rates
17 November 2003
By JAMES WEIR
Westpac is the first of the big banks to lift floating mortgage interest rates, in a move likely to spark a round of small rate rises.
Westpac bumped up its floating rate from 7.1 per cent to 7.25 per cent because of rising wholesale interest rates. On a $150,000 mortgage, the increase meant an extra $6.67 a fortnight.
A Westpac spokesman said the bank was "passing on some of the recent increased cost of funds".
The floating rate was set at 7.1 per cent when the 90-day bank bill rate was just 5.05 per cent, but that has recently moved up to 5.42 per cent.
Westpac also lifted some deposit rates.
The Reserve Bank's official cash rate, a prime influence of floating mortgage rates, is predicted to rise to 5.25 per cent as soon as next month. It may go to 6 per cent next year, taking floating mortgage rates to more than 8 per cent.
Short-term interest rates moved up sharply in the last fortnight, particularly after strong job market figures last week, showing unemployment at a 16-year low of 4.4 per cent.
The low jobless rate and strong retail spending figures increased the chances that the Reserve Bank would lift the official cash rate by 25 basis points to 5.25 per cent on December 4.
However, Reserve Bank governor Alan Bollard will have to balance the impact of a rising New Zealand dollar - now above US63 cents - which will dampen inflation by reducing the cost of imports.
While Westpac moved on floating rates, it held its fixed-term loan rates steady. Last week, both ANZ Bank and KiwiBank moved up to Westpac's fixed rates level.
Since its launch, KiwiBank has been significantly undercutting the big banks, offering lower interest rates on home loans. KiwiBank's floating rate remains the cheapest in the market at 6.55 per cent.
But last week's move puts KiwiBank's fixed-term rates for one to five years, just 5 basis points, or 0.05 per cent, below most of the big banks and higher than some
Regards
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