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October 2017's Property Gazette
Published by Scott Miller
How will the election affect interest rates?
Which parties will make up our new Government? It’s the question on everyone’s lips and the party leaders don’t seem to be giving anything away. The uncertainty has certainly put a stop to many people making large decisions until a new Government has been formed. But how will it affect interest rates?
Should We Be Concerned About Interest Rates?
We don’t think so. Our option at Advanced Mortgage Solutions is that we don’t think interest rates will be changed much by the result. This is because the NZ currency is remaining quite stable.
This is echoed through the Interest.co.nz website where they said, “In the very short-term until 7 October at least, whilst we have a political impasse/vacuum in New Zealand the Kiwi dollar should remain stable. Once it becomes clear with whom New Zealand First leader, Winston Peters decides to negotiate with first and the outcomes from the policy horse-trading that goes with such post MMP election shenanigans, the Kiwi dollar could go either way depending on what type of government we end up with.”
Bernard Hickey published his opinion about interest rate changes the weekend before the election. His comment was that he does not feel interest rates will rise in the short term, even though the National Party believed they would. The NZ Reserve Bank itself has only forecasted one 25 basis point hike by late 2020 and foreign investors don’t seem to be concerned either.
Get Your Free Interest Rate Review
Everyone likes saving money. We would love you to take the opportunity to have a free interest rate review with our team here at Advanced Mortgage Solutions. Book in your time for a chat with us.