We have just gone through a mortgage rate hike set that saw 3 to 5 year fixed rates rise and the rate curve steepen.
But yesterday's RBNZ OCR review has changed the landscape again, if the swap markets are any early indication.
Wholesale swap rates across the curve rose sharply yesterday as markets came to the realisation the RBNZ is preparing for an OCR hike earlier than previously reckoned.
If it does raise rates in early 2014, New Zealand will be the first floating currency economy to do so since the GFC.
And a rise will contrast us with Australia who are widely expected to continue cutting rates.
New Zealand official rates above Australia reverts to the long-run 'normal' situation.
Swap rate benchmarks for one year rose 7 bps yesterday following the RBNZ announcement. This is the largest one-day rise since June 2012.
The same change showed by for the two year swap rate as well.
For 3 to 5 years, the jump was twice as much, echoing what happened about a month ago which resulted in the most recent fixed rate mortgage hikes.
On their own, these one-day changes are unlikely to mean fixed mortgage rates will rise immediately in response, although discounting may become more limited.
But if they are an early indicator of future rate directions, carded fixed mortgage rates could be in for another round of increases, this time across the board.
And the recent rapid shift to fixed rates away from floating may be temporarily reversed until the OCR actually does change.
(Keep this in mind: Swap rate trends have shown a weak pattern in the past of rising through Thursdays and then trending back from there, so the observations above need to be seen in this light.)
See all advertised mortgage rates here.
| 1 yr | 2 yrs | 3 yrs | 4 yrs | 5 yrs | |
 |
4.95% | 5.65% | 6.05% | 6.30% | 6.60% |
 |
5.25% | 5.65% | 6.05% | 6.30% | 6.60% |
| BNZ | 5.25% | 5.65% | 5.89% | 6.30% | 6.60% |
| Kiwibank | 4.89% | 5.50% | 6.05% | 6.30% | 6.60% |
 |
5.19% | 5.65% | 6.04% | 6.30% | 6.60% |
| Co-op Bank | 4.94% | 5.50% | 5.95% | 6.15% | |
| HSBC Premier | 4.99% | 565% | 6.05% | 6.30% | 6.60% |
| SBS / HBS | 4.95% | 5.25% | 5.65% | 5.99% | |
 |
4.88% | 5.50% | 6.05% | 6.30% | 6.60% |
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