Kiwibank also raises interest rates

The company is attributing the increase to rising base interest rates imposed by the Reserve Bank.

Kiwibank has raised its fixed rates from the six-month limit to four-year loans, in contrast with the BNZ’s inaction on longer term loans.  

For Kiwibank, the two-year fixed rate has gone up from 5.45% to 5.65%, where there is a deposit of at least 20%.

With lower deposits, the two-year rate has gone up from 6.45% to 6.65%.

The bank’s chief economist Jarrod Kerr says the volatility in interest rates in recent years has been dramatic, but he expects interest rates to peak over the next year (2022/2023) as the economy cools and inflation eases.

“Mortgage rates are likely to peak at or slightly above current levels,” Kerr said. 

“Mortgage rates are likely to hold around current levels into next year”.