ANZ to raise home loan rates on Thursday as funding costs soar

Interest rates on fixed-term home loans will rise on Thursday at ANZ.

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Interest rates on fixed-term home loans will rise on Thursday at ANZ.

ANZ has announced significant increases to its fixed-term mortgage rates.

The bank will raise its standard one-year mortgage rate by 54 basis points on Thursday, from 6.05% to 6.59%.

It will increase its two-year fixed-term mortgage rate by 44 basis points, from 6.35% to 6.79%.

Borrowers with more than 20% equity in their home pay less for their loans to ANZ.

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The bank’s one-year “special” mortgage rate for high-capital borrowers is increased from 5.45% to 5.99%.

The increases followed Wednesday’s announcement that annual inflation continued to climb to 7.2%.

A bank spokesperson said there was continued volatility in global funding markets, as well as a significant increase in wholesale market rates.

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“With that in mind, we are making changes to our fixed mortgage rates while updating our term investment rates to help customers meet their savings and investment goals,” she said. declared.

“Interest rates will continue to be reviewed in response to international and local market conditions.”

The bank also raised term deposit rates, but less than mortgage rates.

Its main 90-day term deposit rate for people with $10,000 or more invested will increase by 25 basis points to 2.15%, and its one-year rate will increase by 40 basis points to 4.3% .

On Wednesday, independent economist Tony Alexander predicted that banks would react to inflation remaining stubbornly high by raising their fixed-term mortgage rates.

Alexander said borrowers should also prepare for increases in fixed-rate loans in the coming days after Stats NZ said prices rose 2.2% in the September quarter, carrying annual inflation at 7.2%, just below the 7.3% annual rate reported three months ago.

Alexander said banks held back on rising fixed rates on home loans, despite rising funding costs.

Independent economist Tony Alexander said banks would raise fixed-term home loan rates.

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Independent economist Tony Alexander said banks would raise fixed-term home loan rates.

“We’re going to see a series of pretty big increases in fixed mortgage rates,” he said.

Bank economists now predict that Reserve Bank Te Pūtea Matua will raise the official exchange rate (OCR) by 75 basis points next month, which SBA Chief Economist Nick Tuffley said would be followed by increases of 50 basis points in February and April.

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