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Posted by Jeni Evans on January 05, 2016

As a homeowner with a mortgage, with still plenty of years left to pay, repayments have been made so much easier over the last five or six years. With the economic crisis in 2008, my monthly repayments suddenly fell by almost 200 euro overnight as soon as the property crisis kicked in, and they have been falling steadily ever since.

Each December, which is when my annual revision takes place, I keep my eyes on the evolution of the mortgage reference rate, hoping that it will fall that little bit lower each time. And I haven’t been disappointed so far.

But with each year, the reductions are becoming smaller and it’s getting hard to believe that the Euribor could drop even lower. But it has. Which is fantastic news not just for me, but for all homeowners that owe money to their bank.

And 2015 has been a historic year for the Euribor over the last 12 months. Already at an all-time minimum at the beginning of the year, the rate has continued to fall – to even newer lows.

At the end of 2014, the Euribor registered 0.328%, but by the close of 2015, it had been reduced to 0.059%, which is a reduction of 82%.

This is the biggest percentage drop in the last decade. Before that, the most the Euribor had fallen was by 70% in 2012.

Also in 2015, this was the first time that the mortgage reference rate had dropped below 0.1%, and even lower than the official price of the euro, which had been set at 0.05% since 2014 by the European Central Bank (ECB).

So, now that we have just entered a new year, what’s the outlook for the Euribor for the immediate future?

Well, according to the ECB, its monetary policy will remain the same until 2017 for definite. The official body has insisted that it is in no hurry to increase interest rates.

Other experts believe that the Euribor still has room to drop even further – to 0.04%, which is 0.02% less than the current level.

While a good indication of how the Euribor will react is by looking at the European benchmark interest rate, there are other factors to take into consideration as well. For example, it is worth keeping an eye on the price of raw materials, the Federal Reserve’s monetary policies (interest rates went up for the first time in nine years in December), the euro zone’s own economy and inflation.

Despite the fact that there are a number of elements to consider, in general, there shouldn’t be any surprises on the market in the near future.

If GDP and inflation do not increase to the optimum rate of 2% within the euro zone, it is unlikely that any changes will be made to the region’s monetary policies.

The IMF has warned that the global economy in 2016 will be pretty underwhelming – the economy in the euro zone is expected to grow 1.9% and inflation will register at 1.5%. Oil prices are also expected to stay at minimum levels.



  • Spain
  • euro zone
  • Euribor
  • mortgages
  • economy
  • property


leftOn The Pulse is a leading website dedicated to researching and reporting up-to-date information about Spanish property, legislation and the economy