Opinion - When will ECB Rate rise ...

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Codogly

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Just wondering when ECB interest rates will start to rise again. I know its guess work and difficult to estimate just interested in people's opinions.
Personally i can't see any increase until 2014 at the earliest.

Codogly
 
Given the severity of unemployment EU wide and the fact that there is talk of negative interest for bank deposits with the ECB you would have assumed that it will be some time off. That said I guess what happens in Germany will be a large influencing factor. And, if there is further reductions local banks are likely to ignore these and levy increases to regain profitibility.
So bottom line is I agree with OP it will not be soon.
 
Draghi, the ECB president has said that there may be further cuts in interest rates. A base rate cut from 0.50% to 0.25% is possible.

There are no indications that an interest rate rise is on the immediate horizon.
 
Hi Codogly In regard to the rate increase i believe it is some way off (however economics in the bigger countries can change very quickly)but i think the question is more directed towards what will happen then when rates increase and i believe it would be prudent to calculate what your mortgage would cost if ECB rates were 1%, 1.5% etc. and to begin to allow for that in the plans so in effect you could fix your cost as follows. If at present you are paying 1,000 per month to your mortgage and an ECB increase would put the cost of the mortgage to say 1,300 it would be prudent to at present or when suits to 'practice' this payment level and set it (the 300 overpayment) aside for the day when rates do start to increase. If this is a good while away it will simply mean you will have a bigger lump sum accumulated and also be sure that it is affordable and the increase will not come as a surprise, and as a last resort you will also have a lump sum to pay off the mortgage to enable you to keep the cost low. In summary the ECB rate will increase but who knows when but it would be smart to plan early (this of course is directed to trackers only as the lenders are taking this choice away from SVR customers). Padraic
 
To address OP question my guess would be that there will be a drop as Ciaran T says but that it will probably be 2015 before the ECB base rate rises to 1% given the general state of the economies in Europe and the growing consensus for a stimulus package however limited. It is only my guess. I would take the post of Padkiss as good advice
 
Thanks Folks ...one things for sure its in our interest that the stay low while we see out this austerity.

Codogly.
 
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