ECB rate cut to 2.15%

Announced this afternoon

Thanks I'm reading everywhere about ecb reducing mortgage rate to 2%....I was starting to think I was missing something https://www.thejournal.ie/european-central-bank-interest-rate-cut-6724022-Jun2025/

There are three ECB rates:

1. Deposit facility - currently 2.00%
2. Main refinancing operations (fixed rate tenders fixed rate) - currently 2.15%
3. Marginal lending facility - currently 2.40%

#1 is the main one that economists focus on these days.
#2 is the base rate for most tracker mortgages.

Nuttynuts said:

Thanks I'm reading everywhere about ecb reducing mortgage rate to 2%....I was starting to think I was missing something

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RTE reported the 2% rate yesterday and I notified them that it was wrong but they have not corrected it.

Nuttynuts said:

ECB cuts interest rates to 2% in good news for mortgage holders and first-time buyers

Ireland is the fifth most expensive country in the eurozone for mortgages.

www.thejournal.ie

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They attribute it to AFP

With reporting from Keith Kelly and © AFP 2025

I have notified the Journal

email heading: Your ECB rate article is incorrect

The relevant eCb rate for mortgages is 2.15%

The confusion here is because a while ago the main "policy" rate switched from being the main re-financing rate to the deposit rate.

The ECB now reports the deposit rate as the main headline policy rate.

But tracker mortgages in Ireland are priced off the re-financing rate, which used to be the headline policy rate.

Thanks both....they should do better to be fair ! They obviously don't have tracker mortgages !

Nuttynuts said:

They obviously don't have tracker mortgages !

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I wonder how many tracker mortgages there are as a proportion of the mortgages in Ireland? Is be guessing it's not that many.


c18% as per this https://m.independent.ie/business/p...-ticket-at-risk-of-dying-out/a1931023173.html

The language is perhaps a little loose around the tracker side of things but 2% is the relevant rate for new lending.

The deposit rate is the relevant rate for affecting the (new) lending rates of banks when those banks have excess funds (I.e., a glut of deposits). This is the rate the ECB offer to deposit money with them.

The ECBs Main refinancing operations works as a lending rate to commercial banks.

These days most banks in Ireland fall under the first category.

Yes trackers are directly linked to the second rate but they are a small and decreasing share of the mortgage market.

When the ECB change rates they usually move them all in lockstep so I'll give the journalist some leeway for not dwelling on the minutiae of euro area monetary policy.