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Anatomy of Interest Rates

  

Drivers of interest rate changes

  • New Zealand interest rates for terms from 1 month to 2 years are largely determined by local inflation, monetary policy and economic conditions.
  • New Zealand interest rates for terms from 2 years to 15 years are determined by movements in base US long-term interest rates.
  • The margins above US Govt. bond yields do change, depending on the credit standing of the borrower.