With the OCR rate increase, it pays to remember two vitally important things as you contemplate whether to switch to a fixed rate and when to do it.<\/p>\n
First, every policy tightening period is a suck-it-and-see exercise.
\nYou never know for certain how borrowers, savers, businesses, and the exchange rate will react to rising interest rates.<\/p>\n
Last time the RB started raising rates just over a decade ago, the common view was that the cash rate would rise from 5% to 6.25%. I picked 7.25%. The actual peak was 8.25%.
\nThe second important point to note about this rate tightening period is that
\nno-one has an economic model which tells us how economies move after almost falling into GFC in 2008.<\/p>\n","protected":false},"excerpt":{"rendered":"
With the OCR rate increase, it pays to remember two vitally important things as you contemplate whether to switch to a fixed rate and when to do it. First, every policy tightening period is a suck-it-and-see exercise. You never know for certain how borrowers, savers, businesses, and the exchange rate will react to rising interest […]<\/p>\n","protected":false},"author":1116,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"slim_seo":{"title":"IF I WERE A BORROWER WHAT WOULD I DO? - colinrealestate","description":"With the OCR rate increase, it pays to remember two vitally important things as you contemplate whether to switch to a fixed rate and when to do it. First, ever"},"footnotes":""},"categories":[5532],"tags":[],"class_list":["post-561","post","type-post","status-publish","format-standard","hentry","category-real-estate-2"],"_links":{"self":[{"href":"https:\/\/colinrealestate.blogtown.co.nz\/index.php?rest_route=\/wp\/v2\/posts\/561","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/colinrealestate.blogtown.co.nz\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/colinrealestate.blogtown.co.nz\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/colinrealestate.blogtown.co.nz\/index.php?rest_route=\/wp\/v2\/users\/1116"}],"replies":[{"embeddable":true,"href":"https:\/\/colinrealestate.blogtown.co.nz\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=561"}],"version-history":[{"count":2,"href":"https:\/\/colinrealestate.blogtown.co.nz\/index.php?rest_route=\/wp\/v2\/posts\/561\/revisions"}],"predecessor-version":[{"id":565,"href":"https:\/\/colinrealestate.blogtown.co.nz\/index.php?rest_route=\/wp\/v2\/posts\/561\/revisions\/565"}],"wp:attachment":[{"href":"https:\/\/colinrealestate.blogtown.co.nz\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=561"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/colinrealestate.blogtown.co.nz\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=561"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/colinrealestate.blogtown.co.nz\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=561"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}