Photo: RNZ / Dom Thomas
The country's biggest bank has moved to match BNZ with a one-year home loan rate below 4.5 percent.
The reduction of 26 basis points to 4.49 percent was the lowest the rate had been since May 2022, ANZ said.
It said it was also cutting its six-month fixed rate by 10 basis points to 4.89 percent and the two-year by 10 basis points to 4.65 percent.
"Since we started cutting rates in March last year, our 1-year home loan special rate has fallen by 2.9 percent," said ANZ general manager of home loans Emily Mendes Ribeiro.
"For someone fixing their home loan at today's rate, compared to fixing in March last year, that equates to around $10,000 of savings on repayments across a year on a home loan of $500,000.":
The Reserve Bank is due to review the official cash rate next week and weaker-than-expected gross domestic product data has fuelled calls for a drop of 50 basis points.
Kiwibank chief economist Jarrod Kerr said the weakness in the economy demanded stimulus.
"With all the risks offshore, and the pain still felt onshore, there's a good argument to be made for taking policy firmly into stimulatory territory ASAP. An argument that is growing in support.
"It's clear that our economy needs support. There's simply no other way to put it: the Kiwi economy is underperforming. It's underperforming our already weak forecasts. And it's underperforming our peers around the world. It's saddening to see an economy still contracting after last year's deep and destructive recession. We fell into a hole then, and we've only dug ourselves deeper."
He said the interest rate cuts so far were not yet stimulate spending.
"At 3 percent the cash rate is neutral."
He said it would take a rate of 2.25 percent to 2.5 percent to encourage activity again.
ANZ economists said they would put 35 percent odds on a 50 basis point cut.
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