January closes with record low for the Euribor
Every month we are reporting that the Euribor has ended the previous 30 days at its lowest rate ever. And it’s difficult to see how the reference rate used to calculate the majority of mortgages taken out in Spain can get any lower.
At the end of 2015, the month of December registered the lowest rate for the Euribor, and now, at the start of 2016, the trend seems to be continuing.
But, at the end of January, while the Euribor once again dropped to new minimum lows, this time the event was even more spectacular.
By 31 January, figures indicated that the Euribor would stand at the rate of 0,044%. Not only is this the lowest rate in the history since records began, but it is also lower than the official price of money, set in September 2014 by the ECB, which is 0,05%.
Twelve months earlier, the Euribor ended 2014 at a rate of 0,328%; it closed the following year at 0,059%; and now, a month later, it will end January 0,018 points lower.
Despite the fact that we’re dealing with incredibly small figures, the Euribor has accumulated a drop of 87% over the last 13 consecutive months.
Much of this is due to actions carried out by the European Central Bank, who have kept benchmark interest rates as low as possible, even reducing them over time.
It has also spent the last ten months buying up massive debt in the markets, which has subsequently made ready cash much more available, but also reduced the profitability of many assets, including the Euribor.
On the plus side, mortgage owners are feeling the positive effects of this, as their monthly mortgage repayment rates continue to fall each year.
At the moment, everything indicates that the Euribor will continue to fall. This is demonstrated by the fact that the mortgage reference rate is currently floating around 0.03%.
And Bankinter has even gone so far as to say that the Euribor will enter negative figures during the first half of this year and willstay around -0.1% at least until the summer of 2017.