The Euribor continues its downward trend these last weeks, something that those who have debts to return, for example a variable mortgage. But they are not the only ones, companies and public administrations are also preferred in the middle of uncertainty.
A. Aramendi Elduien | EITB average
The spirit of the economic recession has replaced the fear of inflation within the European Central Bank. The European Agency warns that the commercial tensions announced by the United States will negatively influence the rates announced by the United States by the United States. They mainly relate to Germany’s data, which until recently was the engine of the European economy.
Therefore with the object to promote consumption and prevent economic activity Too much, the ECB has reduced interest rates. During the last meeting of April 17, he placed them at 2.25 %. Consequently, the Euribor, the index obtained from the average of the rates that European banks borrow money, have also carried out a downward path.
Until a few months ago, the greatest care of the ECB was the opposite, inflation (price increase), which always tries to keep around 2 %. However, when the war broke out in Ukraine in 2022, the prices and the situation did not shot. The ECB reacted with a progressive rise in interest rates, with the aim of stopping the consumption and reducing the price increase. However, it can be said that the care for inflation is currently being overcome, because it was 2.2 %in April, within the desired parameters.
Now the strategy is to maintain the low species of the concern of the economic predictions and the valuation of the euro against the dollar due to the rates.
These UPS and Downs of interest rates have a direct influence on the Euribor, the index used to determine the interests of many of the loans given to families and companies, for example mortgages on a variable type. At the moment, the Can the average of the Euribor A 12 months is in one 2,041 % And compared to May 2024, 1.5 %has been moderated. Therefore, those must Check your variable mortgage nowadays or hire a new one They will find cheaper costs, something that can also stimulate the purchase of housing despite high prices.
To give an example, the reimbursement of an average mortgage of 150,000 euros must be returned in 25 years and is reduced by 1 % differential 135 euros, from € 974.15 to € 839.6.
This situation is not alone advantageous For those who pay for a house, it also helps Many companies. With lower interests, many companies can encourage loans to make new investments. In the words of Niko Cuenca Economic AnalystThe news “is a spark of hope, in the midst of the uncertainty generated in the geopolitical context.”
The third parties beneficiaries Euribor level Public administrations. The price of the government debt has been reduced, something important in times when the shortage control is discussed.
However, there is also the Another face of the currency, who in this case are the ones who have savings And they want a profitability for them. For example, those who have invested in deposits or treasury letters will see their profit lowered compared to those obtained in previous years.
Source: EITB
I’m Wayne Wickman, a professional journalist and author for Today Times Live. My specialty is covering global news and current events, offering readers a unique perspective on the world’s most pressing issues. I’m passionate about storytelling and helping people stay informed on the goings-on of our planet.
