Euribor falls by 3%: such a reduction in mortgages and how it will fall further

Euribor brings great joy to mortgage holders who have to renegotiate their mortgage.. And the indicator most used in our country for mortgages falls by 3%, for the first time since December 2022.

The fall comes as the European Central Bank cut rates to two in June and again in September, as well as expectations that last month’s eurozone rate cut would not be the last. . for the rest of the year. At the very least, the market average expects another decline for the remainder of 2024.

To do this, though, we’ll have to keep a close eye on the data, which shows two things. On the one hand, this growth in the eurozone is quite weak– up to 0.3% with a reduction in Germany, which is confirmed not only by figures, but also by forecasts of international organizations.

On the other side, reduction in inflationwhich closed August down four-tenths year-on-year despite a 0.1% monthly increase. It still falls short of the ECB’s desired target of 2%, but is firmly approaching.

And what’s even better is that consumer expectations in single currency countries have reached their lowest levels in 3 years, as we learned last Friday, noting the inflation rate, 2.7%, the lowest for that period. At the same time, in the medium term in three years it will amount to 2.3%.

From XTB consider that “Euribor will continue its downward trend in the coming weeks until it reaches levels close to 2.50%.However, we believe that in the last months of the year it will stabilize its current dynamics due to current inflation risks. Rate cuts at the global level, the evolution of services, monetary stimulus in China and the comparative base effect in falling energy prices could lead to a new rise in inflation that will limit future central bank decisions, mainly in the case of the ECB. whose main goal is price stability.”

Although they stress that “however, the pressure the Fed could bring by cutting rates more aggressively could push the European body to cut interest rates twice for the rest of the year.”

Therefore, and in the absence of official confirmation from the Bank of Spain, which is likely to happen today, Euribor ends September at 2.946%.

Throughout September, the daily Euribor amount declined, starting with a high on the 3rd of the month at 3.113% and finally falling below 3% on the 9th. even at levels of 2.755% in the last days of the month, which is significantly below the monthly average, this gives us an idea of ​​the trend to follow.

In fact, in the last session yesterday it went down again. new low at 2.477%which marks such a low level in one session that it has not been recorded in the indicator since November 2022.

The most important thing at the moment is the amount of mortgage discounts achieved over the last month. A very significant drop for the pocket, no doubt. And let’s not forget where we come from. For those who are facing a review, a reduction in the subscription fee, In the case of an annual review, this is approximately 106 euros.with an average mortgage of 150,000 euros, for 30 years and a difference of 0.99%.

And this represents a more than significant annual reduction of €1,284.. It must be taken into account that we are based on September 2023, the date when 4.149%

If the review is done every six months, as iahorro.com reports, the amount will be less, about 64 euros per month for this average mortgage.