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EURIBOR CLOSES MAY ON A NEW HISTORICAL MINIMUM

Euribor baja

The Euribor, index to which the majority of Spanish mortgages are referenced, closed the month of May at -0.127%, in a way that deepens its historical lows, which will allow the mortgages to be reduced to which they will be reviewed in About 72.84 euros per year.

The Euríbor stood on the last day of the month at -0.131%, which gives a monthly average of -0.127%. The index has followed a bearish path in May, which started at -0.121% and has been deepening in the 22 days in which there has been banking.

With these values, the mortgages of 120,000 euros to 20 years with a differential of Euríbor + 1% to which they touch revision will have a reduction of about 72.84 euros in their annual quota or, which is the same, 6,07 Euros per month.

The Euribor penetrated in February last year in negative territory for the first time in history in the face of the European Central Bank’s (ECB) ultraexpansive policy to shore up the recovery in the euro zone.

The index remains depressed below 0% – current level of interest rates in Europe – about to turn fifteen consecutive months, although it is true that the falls are slowing.

 

It will remain negative as long as the ECB maintains the stimuli

According to XTB analyst Gustavo Martinez, this interest is “increasingly negative” and will remain so “as long as the monetary stimulus continues.”

“We think that if there is an excess of monetary mass in the banks without there being a real demand for bank credit, the normal thing is that they are willing to charge an interest to demand money that they do not need,” he told Europa Press.

According to the analyst, lending money and paying for it “will remain the general trend if the European Central Bank (ECB) does not end these stimuli allowing demand for credit and money supply can adjust.”

“The reality is that, in the face of this mismatch of monetary equilibrium, inflation is a fact and as a consequence, the ECB should not only withdraw stimulus, but also have to cool the economy with interest rate rises making it more attractive and Fluid the supply of credit than in the current situation, “added the expert.

If this were to occur, the situation would normalize “with a consequent increase in the volume of interbank credit and increase in the volume of credit in the real economy”, ie consumer loans and mortgages and, therefore, a Increase in the Euribor that will cause indebtedness, mainly mortgages at variable rates and consumer loans, “to inexorably increase”.