Westpac’s chief economist summarises it up when he says that his overall impression is that the Reserve Bank is relaxed and does not want to rock the boat. The Reserve Bank believes that the best thing to do is to leave the OCR low given the geopolitical uncertainty and economic uncertainty not just in NZ but overseas.
Currently, this means OCR rates are not likely to rise until 2020.
Banks seems to agree with his opinion and have lowered their one yr interest rate. If mortgage interest rates fall, and it will help the housing market. Guess who came out with a 3.95% one year home loan rate? Westpac has lowered its one year rate to 3.95% (conditions apply) but they are not the only one.
Also TSB offers 3.95% for one year (conditions apply). This is currently the lowest rate on the market as of 15 November 2018.
Even with historical low interest rates, banks are continuing to do well. ANZ recently reported $2 billion profit for its NZ operations and Westpac followed showing it earned $1 billion from its NZ operations. So no need to worry about lowering interest rates hurting banks profitability.