Euribor rises (all maturities) to new 14 year highs

Euribor rises (all maturities) to new 14 year highs

The three, six and 12 month Euribor rates rose today to new 14 year highs, at 2.682%, 3.166% and 3.542% respectively.

The 12-month Euribor rate, which is currently the most used in Portugal in variable rate mortgages, rose today to 3.542%, up 0.024 points, a new high since December 2008.

According to the Bank of Portugal, the 12-month Euribor already represents 43% of the ‘stock’ of loans for permanent owner-occupier mortgages with a variable rate, while the six-month Euribor represents 32%.

After shooting up on 12 April to 0.005%, for the first time positive since 05 February 2016, the 12-month Euribor has been in positive territory since 21 April.

The average 12-month Euribor advanced from 3.018% in December to 3.338% in January, up 0.320 points.

The six month Euribor rate, which entered positive territory on 6 June, also advanced today, to 3.166%, up 0.031 points, a new maximum since December 2008.

The six-month Euribor was negative for six years and seven months (between 06 November 2015 and 03 June 2022).

The average six-month Euribor rose from 2.560% in December to 2.864% in January, up 0.304 points.

In the same vein, the three-month Euribor, which entered positive territory on 14 July for the first time since April 2015, advanced today, when it was fixed at 2.682%, up 0.022 points, a new maximum since January 2009.

The three-month Euribor rate was negative between April 21, 2015 and last July 13 (seven years and two months).

The average three-month Euribor rose from 2.063% in December to 2.354% in January, an increase of 0.291 points.

Euribor has started to rise more significantly since February 04, 2022, after the European Central Bank (ECB) admitted that it might raise key interest rates this year due to rising inflation in the Eurozone and the trend was reinforced with the start of Russia’s invasion of Ukraine on February 24, 2022.

At its last monetary policy meeting, on February 2, the ECB raised its key interest rates again by 50 basis points, the same as on December 15, when it began to slow the pace of increases compared to the two previous ones, which were 75 basis points, on October 27 and September 8, respectively.

On 21 July, the ECB raised the three key interest rates by 50 basis points for the first time in 11 years.

The three, six and 12-month Euribor rates were all-time lows, respectively of -0.605% on 14 December 2021, -0.554% and -0.518% on 20 December 2021.

The Euribor is fixed by the average of the rates at which a group of 57 banks in the euro zone are willing to lend money to each other on the interbank market.

Financial analysis