NZ banks start increasing interest rates

by Richard Kilner

Story link: NZ banks start increasing interest rates

A survey conducted by Research New Zealand has discovered that consumers are planning on cutting spending in anticipation of economic difficulties.

Over 50% of respondents indicated that rising petrol prices and interest rates were leading them to lower their own spending.

The news comes as another NZ bank raises its own interest rates.

ASB Bank has increased its rates for mortgages, following in the footsteps of ANZ National.

It is predicted that other banks will soon do likewise.

Two days ago ANZ National, the nation’s biggest bank, increased its two year fixed mortgage rate to 9.7%, and its three year fixed rate to 9.55%.

Yesterday ASB increased its floating rate of interest by 20 basis points, in addition to some deposit rate rises.

Both banks cite the rising cost of borrowing money internationally as the grounds for their increases.

Bruce Thompson, a spokesman for Kiwibank, urged those considering taking out a loan not to delay.

Thompson has stated that it is probably inevitable the bank will have to increase its variable rate.

However, Thompson went on to say that the bank’s situation differed to those of Australian-owned firms as the sub-prime mortgage crisis hadn’t had a real impact on Kiwibank.