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Speaker 1: Well they have done it. The Reserve Bank has decided

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Speaker 1: to cut the OCR by fifty basis points from five

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Speaker 1: point twenty five to four point seventy five, the second

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Speaker 1: consecutive cut after the OCR was lowered in August for

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Speaker 1: the first time in four years. All the big banks

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Speaker 1: ASB and z Kiwi Bank predicted the fifty point drop,

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Speaker 1: although twenty five basis point drop was still on the

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Speaker 1: cards in the eyes of some economists. The Cooperative Bank

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Speaker 1: CEO Mark Wilsher is with us this evening calder Marker

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Speaker 1: Jack to be on, Yeah, what's this going to mean

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Speaker 1: for New Zealanders.

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Speaker 2: I think it's good news for home borrowers. That's a

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Speaker 2: big drop, and you know we've often seen those big

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Speaker 2: fifty point changes up like an earthquake or global financial crisis,

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Speaker 2: so it's quite a big move and it does mean

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Speaker 2: benefits for customers over the course of the year. That

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Speaker 2: does equate to thousands and people's back pocket again from

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Speaker 2: those lower rates, and I see all of the banks

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Speaker 2: today have moved their floating rates following on for that

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Speaker 2: Reserve Bank announcement today.

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Speaker 1: There is always a bit of a lag right twelve

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Speaker 1: to eighteen months before we get the full weight of

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Speaker 1: moves in the ocr felt throughout the economy. But what

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Speaker 1: does a fifty basis point cut today say about the

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Speaker 1: state of our economy.

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Speaker 2: Yeah, obviously that was done on the back of some

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Speaker 2: you know, some pretty you know, subdued environment out there

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Speaker 2: in the economy, low spending, et cetera. That's certainly a

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Speaker 2: sign of we have been in two years of recession.

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Speaker 2: But for customers, I guess, and for general public out

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Speaker 2: there who are borrowers at those a lot of those

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Speaker 2: rates are getting passed through quite quickly. Now. Typically you're

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Speaker 2: quite right, there's a slow lag, but actually people have

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Speaker 2: been going short for a little while now on the

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Speaker 2: expectation rates are coming down and we've already seen markets

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Speaker 2: pricing this in. So those FIXT rates have been coming

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Speaker 2: down fast. Start of the year, they were one percent higher,

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Speaker 2: so they've already started to come down quite quickly and

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Speaker 2: people are getting the benefit of that now.

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Speaker 1: So just how competitive are those rates at the moment.

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Speaker 2: Well, there's quite a flurry of changes out there in

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Speaker 2: the market place, so it's got a good healthy market

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Speaker 2: to begin and to be shopping around and looking at options.

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Speaker 2: And you know, for example, we're going to one year

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Speaker 2: rate six point one nine. I mean, that's that's pretty

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Speaker 2: good rates from where it has been the start of

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Speaker 2: the year of those rates when the sevens. So yeah,

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Speaker 2: it can say there's a competition out there now and

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Speaker 2: in that climbing rate environment, that's good news for the

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Speaker 2: general public who've got options.

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Speaker 1: Does this mean that we can expect another fifty basis

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Speaker 1: point cut come November when or Reserve Bank considers things

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Speaker 1: for the final time this year?

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Speaker 2: You know, that's what markets are expecting. So the November

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Speaker 2: twenty seven official cash rate, the interest rate marks are

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Speaker 2: pricing in another fifty point cup on top of the

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Speaker 2: fifty we've just seen and the twenty five in August.

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Speaker 2: So that's a total of one point twenty five percent

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Speaker 2: in total. If all of that happens, obviously remains to

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Speaker 2: be seen, and that's in the hands of the Reserve Bank

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Speaker 2: for November. But it'll be interesting to see what happens

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Speaker 2: in that pre Christmas announcement.

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Speaker 1: Yeah, I think your time mark appreciate it. That is

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Speaker 1: the Cooperative Bank CEO.

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Speaker 2: For more from hither Duplessy Allen Drive listen live to

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Speaker 2: news talks.

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