Photo: AFP
Westpac is reducing the interest rate it charges on some of its fixed-term home loans.
Its one-year special rate drops by 20 basis points to 5.59 percent, its 18-month rate by 30 basis points to 5.39 percent, and its two-year rate by 10 basis points to 5.39 percent.
It follows a move by ANZ on Wednesday.
The bank will also reduce some of its term deposit rates by 5, 10 and 20 basis points.
BNZ chief economist Mike Jones said on Wednesday that 81 percent of mortgages now had less than 12 months until they refixed.
"In data going back to 1999, that's only been matched once before, in 2011/12."
He expected six-month and one-year rates would fall below 5 percent by about the middle of the year.
The Reserve Bank is expected to cut the official cash rate by 50 basis points next month, although markets have priced in much of the reduction already.
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