Euribor today: The Euribor marks an annual low this Monday and is already threatening to break the 2.5% barrier in its monthly rate.

Table of Contents

• 1 How long will the decline of Euribor last?
• 2 How will it affect my mortgage?
• 3 How was Euribor estimated?
• 4 What potential consequences, both positive and negative, could arise from the Euribor ​dropping below the 2.5% threshold for homeowners with adjustable-rate mortgages?

The Euribor, the index to which most variable rate mortgages are referenced, shows This Monday, November 25, 2024 a new minimum annual rate of 2.416%, so it is still below the barrier of 2.5% in its daily rate, already threatening to close the month under the same barrier that, which has not happened since the month of September 2022.

During the month of November, the Euribor has marked a clear downward trend, which has been reinforced by eight consecutive days of falls, collecting 0.21 base discount points for a mortgage index. Now, in the last part of the month, it has increased a little in several days, but the average is still the same.

Of course, if the trend continues down, the Euribor could close for the first time in two years below 2.5%, a figure not seen since September 2022, just the beginning of the climb that marked historic highs.

As for this Monday’s data, the Euribor cuts 0.073 points compared to the previous day’s data, so the The provisional average for the month of November remains at 2.52%threatening to exceed 2.5 down. So much so that, leaving the Euribor at an average of 2.4% in its daily rate in the remaining days until it closes, the monthly average would end up with a figure of 2.49%, which would be enough to break that barrier.

How long will the decline of Euribor last?

The year 2024 is about to end, so our sights are already set on the next 2025, when many will ask what will happen to the mortgage table and the installments to be paid. For now, the ongoing cuts by the European Central Bank (ECB), as well as expert forecasts, They make us think that the declines are going to continue in the same dynamic than a few months ago, at least until June 2025.

In fact, these continuous drops in the daily rate and the cut per meeting lit by the ECB are below the forecasts of the research houses. For now, Funcas, which collects in its economic forecast panel the opinions of 19 of the most prestigious economic companies in the country, such as bank or university research services, gathers a consensus on how the Euribor forward in the coming seasons. For the second quarter of 2025, he aims for an average of 2.46%, while he already has his forecasts for the end of the year and In the fourth quarter it already indicates an average of 2.35%.

But what do the people themselves say? Euribor in the future? The Euribor is prepared by the interbank loans that the big financial institutions in Europe make among themselves, but, at the same time, it is also announced in the financial markets, through financial future. Three months is the most common and its contracts are usually interpreted as a good indicator of what Euribor investors expect. While they were last week they were put in the 2.06%the new data goes further and puts the December 2025 contract in the 1.93%.

How will it affect my mortgage?

This downward movement that the Euribor is suffering direct impact on mortgage reviewsboth semiannual and 12 months, as banks recalculate variable mortgages with the monthly average, rising or falling compared to the data from six to twelve months ago.

To see with an example, for a mortgage of 140,000 euros for 30 years (360 months), with a difference of 1% and taking the month of November 2023 as a reference (since most mortgages are re- study at 12 months), when the Euribor will be at 4.022%, The best value was 753.43 Euro.

Now, with the provisional average for November 2024, which is 2.52%, the mortgage payment of homeowners who have a review in September will drop to 601,02which means that They will pay 152.41 euros less than a year ago and begin to notice the first drop in the monthly payments of those who have a mortgage.

How was Euribor estimated?

The Euribor corresponds to the name European InterBank Offered Rate and is calculated through a panel of European banks that report daily the rate at which interbank loans are granted. From 2020, calculations will be done in a hybrid way. Panel data is included, but also the market’s own estimates, with the aim of reducing volatility and manipulation risk, to which these indices were subject at the turn of the century.

The panel consists of 18 European banksamong them Santander, BBVA, Barclays, Deutsche Bank or Unicredit.

Every business day at eleven in the morning, the average interest rate at which financial institutions lend capital to each other is published. one week, one month, three months, six months and 12 months.

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