NoRegretsCoyote
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Give it one week – the ECB rate hike is next week, to be followed very shortly thereafter by rate increases by Irish lenders, I would imagine.I'm not sure why Irish rates are stuck where they are and euro area rates are rocketing.
Give it one week – the ECB rate hike is next week, to be followed very shortly thereafter by rate increases by Irish lenders, I would imagine.
But it is a bit strange that they haven't moved sooner.
If you look at the rates charged on all outstanding mortgages (not just new business rates), then Ireland is pretty much bang in line with the eurozone average.
This is the same everywhere though especially when you have a predominance of accounts on longer fixed rates. I think new lending is as good a like-for-like comparison as you can get.The new business figures in Ireland are also misleading. Because so many existing customers are paying much higher than the new business rate.
Is this radically different elsewhere? In any case I think Irish banks have to hedge to some extent and the derivatives price they face are the same.Also, Irish banks principally finance mortgage lending from deposits.
This is the same everywhere though especially when you have a predominance of accounts on longer fixed rates.
.. And further to your point. We've seen fixed rates remain artificially low while hedging costs have sky-rocketedHi Coyote
We have a completely artificial mortgage pricing system in Ireland.
At a time of rising ECB rates, you would expect the fixed rates to be higher than the variable rates, but it's the other way around in Ireland.
There is no justification for this, other than the variable rates are artificially high.
I doubt that is the same everywhere.
Brendan
Is this radically different elsewhere? In any case I think Irish banks have to hedge to some extent and the derivatives price they face are the same.
Unless I missed it, the Irish banks still haven’t increased their new business mortgage rates following the 8 September ECB rate hike.Give it one week – the ECB rate hike is next week, to be followed very shortly thereafter by rate increases by Irish lenders, I would imagine.
I keep an eye on Bank of Ireland rates for existing customers like me and I screenshot fixed rates every so often. Rates are identical since October 2019 except for the ten-year rate which has gone up from 3.3% to 3.5%.Unless I missed it, the Irish banks still haven’t increased their new business mortgage rates following the 8 September ECB rate hike.
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