Stay floating and wait for RBNZ decision
Westpac Weekly Commentary says fixing before the Reserve Bank's decision is known is of little value, given the likely market response to various scenarios.
It says an OCR cut would probably generate a sharp fall in floating rates and a fall in fixed rates, while an on-hold decision could leave fixed rates unchanged.
"If the Reserve Bank does cut, there may be a window of opportunity to lock in favourable fixed rates, given that Christchurch reconstruction will eventually put upward pressure on the OCR," Westpac says.
BNZ Weekly Overview economist Tony Alexander also recommends borrowers stay floating and says those planning to fix should hold off.
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