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Westpac analysts suggest that the RBNZ’s six-monthly review of the financial system often serves as a window for reviewing the loan-to-value restrictions on mortgage lending.

Key Quotes

“The LVR restrictions have been loosened twice so far, in November 2017 and  2018.”

“We do not expect a further change at this review. House prices are up by just 3.9% in the last year, but there has been a marked acceleration in recent months as mortgage rates have fallen sharply and the threat of a capital gains tax has been removed. The RBNZ will be wary of adding more stimulus at this point.”

“The RBNZ is unlikely to make any substantial comment on its proposal to increase bank capital requirements, ahead of the announcement scheduled for 5 December.”