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Three-, six- and 12-month Euribor falls to new lows in over a year

The Euribor rate fell today to new lows of over a year, three, six and 12 months.

With today’s changes, the three-month rate, which fell to 3.584%, remained above the six-month rate (3.494%) and the 12-month rate (3.238%).

The six-month Euribor rate, which in January became the most used in Portugal for variable-rate housing loans and which was above 4% between September 14 and December 1, fell today to 3.494%, down 0.059 points and a new low since April 14, 2023, after reaching 4.143% on October 18, a high since November 2008.

Data from the Bank of Portugal (BdP) for May indicate that the six-month Euribor is the most widely used, representing 37.5% of the stock of loans for permanent homeownership with variable rates. The same data indicate that the 12-month and three-month Euribor represented 33.8% and 25.2%, respectively.

In the 12-month period, the Euribor rate, which was above 4% between June 16 and November 29, fell today to 3.238%, down 0.082 points and a new low since December 27, 2022, against the high since November 2008, of 4.228%, recorded on September 29.

In the same sense, the three-month Euribor fell, being fixed at 3.584%, minus 0.039 points and a new low since July 3, 2023, after, on October 19, having risen to 4.002%, a high since November 2008.

On July 18, the ECB kept key interest rates unchanged and ECB President Christine Lagarde did not clarify what will happen at the next meeting on September 12, stating that everything depends on the data that is known.

At its previous meeting in June, the ECB had cut key interest rates by 25 basis points, after having kept them at their highest level since 2001 for five meetings and having made 10 increases since 21 July 2022.

Analysts expect Euribor rates to reach around 3% by the end of the year.

The Euribor average in July fell again at three, six and 12 months, but more sharply in the longer term.

The Euribor average in July fell 0.040 points to 3.685% at three months (against 3.725% in June), 0.071 points to 3.644% at six months (against 3.715%) and 0.124 points to 3.526% at 12 months (against 3.650%).

Euribor is set by the average of the rates at which a group of 19 eurozone banks are willing to lend money to each other on the interbank market.

* Portuguese