OCR
OCR and Mortgage Rate Trends
The OCR, currently at 4.75%, controls inflation and affects bank loan rates. If it rises, mortgage and loan rates may increase. Clients with LVR below 80% could see one-year fixed rates around 4.55% by mid-2025.
We use the OCR to achieve and maintain price stability. To keep prices stable, the Increasing the OCR increases interest rates and helps bring inflation down.
Current OCR is 4.75%， next OCR review date 27/11/2024.
The OCR sets the interest rates on the deposits and loans that registered banks have with us. This affects their earnings and costs, and influences how they set their deposit and loan interest rates for you, as their customer.
The interest rates on the longer-term products depend on what banks’ think will happen to the OCR over the life of your deposit or loan.
This means when we increase expectations for the OCR, banks will usually increase their mortgage rates, business lending rates, and term deposit rates.
The text in the image reads: 1-year carded rate forecast，under 80% LVR clients normally will get 0.75% discount from carded rate, which means, fixed one year special rate for clients under 80% lvr may be around 4.55% by June 2025.
No one knows for sure. The exact numbers will likely be wrong, but it's the general direction we're trying to pick.