The European Central Bank (ECB) says goodbye to 2024 with the third consecutive drop in interest rates. The euro supervisor has cut the official price of money by 0.25 points and leaves the reference rate for deposits at 3%. A level similar to that of March of last year, but still far from the negative rates that were recorded before the inflation crisis and which do not seem to be returning, at least in the medium term.
The ECB’s decision will result in more relief for the around four million households mortgaged at a variable rate in Spain or any person or company with variable rate debts. The rate cuts undertaken by the ECB have dragged the Euribor along with them, which already stands at 2.405% in December, far from the maximum of 4% recorded at the end of 2023.
With the provisional data for December, mortgages that are reviewed with the one-year Euribor will experience reductions in the monthly payment of up to 12%. For a typical loan of 150,000 euros for 25 years and a differential of one point over the Euribor, we would be talking about a reduction of 106 euros per month in the bill (1,272 euros in one year).
The new cut in interest rates occurs in a context of growing economic weakness in Europe. The German GDP has not raised its head for almost two years and France is mired in a fiscal crisis, with high public deficits and no prospects of a Government being formed to address the situation in the short term.
More information soon…
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