Westpac is cutting its 18-month home loan rate by 26 basis points.
It takes the rate to 5.19 percent.
None of its other fixed term rates will change.
When the Reserve Bank decided to leave the official cash rate on hold earlier this week, commentators said it was possible it could lead to rate cuts.
Infometrics chief forecaster Gareth Kiernan said there were a couple of reasons for that.
“Firstly, the fact that an increase [this week] was about 90 percent priced in suggests there could be some easing in shorter-term mortgage rates, particularly for six months and, to a lesser extent, one year.
“Secondly, market pricing for future meetings is also likely to be less hawkish given the bank’s failure to tighten today and the relatively dovish statement with a lot of emphasis on the global risks.
“If market pricing for the OCR shifts down by 25 points consistently for the next year, then that could be expected to show up in rates for one year and longer with the effects likely to be proportionately bigger for the shorter rates, one or two years.”