The ANZ, Kiwibank, ASB and BNZ have all cut rates, but without passing on the full 25 basis point cut made by the Reserve Bank.
Conversely, the banks have not passed on the full interest rate cut on term deposits, which would ultimately mean a slightly better return on savings.
Infometrics economist Andrew Beattie said cuts to the floating mortgage rate by retail banks had failed to pass on the full reduction in the OCR.
Based on experiences of cuts in 2016, that would suggest this week's cuts might not be sustained, as banks' other funding costs have not changed.
"Declines in fixed mortgage rates since March and the Reserve Bank's loan-to-value restrictions are far more important influences on the housing market's outlook than [the latest] OCR move," he said.
Yesterday, ASB took the opportunity to lower its variable home loan and Orbit home loan rates. Home loans were down 0.1% from 5.8% to 5.7%, and the Orbit was reduced by 0.05% from 5.8% to 5.75%.
ASB executive general manager retail Craig Sims said the bank's new lower rates provided a competitive option for borrowers, while also balancing the needs of its savings customers.
The BNZ and ANZ both cut 10 basis points off some mortgage rates.
The BNZ's floating rate went to 5.8% for owner-occupiers and to 6.05% for residential investors.
ANZ cut its floating and flexible home loan rates by 10 basis points, while its fixed term interest rates were cut between six and 14 basis points.
The BNZ said it would be leaving its savings rates untouched until a review was conducted.
Kiwibank cut both mortgage and deposit rates.
It cut its floating home loan rates by 15 basis points to 5.65% for those on a variable rate and offset rate, and 5.7% on a revolving retail rate.
Kiwibank would also cut 15 basis points off many of its term deposit rates, with its 90-day rate falling to 3.1% and its 32-day saver rate down to 2.1%.
New Zealand kept interest rates at higher levels than in many other developed countries after the 2008 global financial crisis, and even raised the benchmark rate to 3.5% in 2014.
However, since 2015 it has cut rates eight times.
New Zealand's OCR at 1.5% is on a par with Australia's, which was left unchanged earlier this week.
Reserve Bank of New Zealand governor Adrian Orr said inflation was lower internationally thanks to things such as improved computing power and a more global labour market.
He said interest rates would stay lower for longer, as they had before the 1970s.
"If you want to call it a new normal, call it that," he said.
"I would suggest we are probably back to the original normal." - Additional reporting: AP/NZME
