Euribor|The market expects interest rates to continue to fall. On Tuesday afternoon, the market expected the 12-month Euribor to fall by almost two percent a year from now.
The market expects the three-month Euribor to drop below 2 percent a year from now.
Finland the most used mortgage reference interest rate, the 12-month Euribor, continues to fall. On Tuesday, the interest rate fell to 2.97 percent. On Monday, the interest rate fell below three percent for the first time since mid-December 2022. At that time, the interest rate was quoted at 2.986 percent.
The interest rate has decreased by more than 1.1 percentage points per year. The bill means that Finnish mortgage borrowers already have clearly more money left for consumption. For example, in a 300,000-euro mortgage, the interest rate reduction means more than 3,300-euro lower interest expenses per year.
The one-year Euribor is clearly the most used reference rate in Finland.
On the market it is expected that interest rates will continue to fall. On Tuesday afternoon, interest rate derivatives predict that the 12-month Euribor will fall by almost two percent a year from now.
The market expects the three-month Euribor to drop below 2 percent a year from now.
However, interest rate derivatives are not the truth, but only the market’s best possible estimate of the development of interest rates. Derivatives have often priced the developments realized in recent years badly wrong.
Mortgage borrowers will next receive important information about the direction of interest rates on Thursday, when the European Central Bank (ECB) decides on the direction of its monetary policy. It is expected that the ECB will then decide to lower its key interest rates by 0.25 percentage points. From the point of view of debtors, it is interesting to hear what the ECB has to say about future bills.
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