The 12-month Euribor has maintained the downward trend that began in June and ended the seventh month of the year with a monthly average of -0.279%.
This is the lowest level set by the benchmark indicator for most mortgages in Spain since February, just before the coronavirus crisis broke out, and is moving away from the ‘rally’ of the first months of confinement, when it reached mark highs since the end of 2016. However, the current level is above that registered in July 2019Therefore, the recent falls are not going to translate into a reduction in mortgage payments.
And it is that last year at this time, the Euribor stood at -0.283%, which means that mortgages who have a review of their loan soon will suffer a increase in the monthly fee, although it will be testimonial: for an average mortgage (about 120,000 euros over 20 years), the increase will be about 4-5 euros per year, while for a loan of about 300,000 euros and a repayment term of 30 years, the increase will be about 20 annual euros.
For now Everything points to the Euribor continuing to fall, as indicated by its intraday rate (last July 28 it broke the -0.3% barrier and in the following days it has moved below that level), although it remains to be seen if it will be able to beat the record of last August, when it marked a monthly rate of -0.355% and that for the moment remains the lowest level in history.
The indicator has been in negative territory for four and a half years and experts expect it to remain at these levels for at least a year and a half moreAll at the expense of the decisions that the European Central Bank (ECB) may make on interest rates and as inflation and the economy evolve.
The highest monetary authority has made it clear that it will take the necessary measures to fight the pandemic, which this year will cause an unprecedented recession in the EU, and has implemented extraordinary measures linked, for example, to the purchase of debt. Therefore, the market discovers that, before touching the price of money, the guardian of the euro should gradually withdraw the other stimuli, hence no changes in the Euribor are expected at least until 2022.
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