Finance
Dec 20, 2022
Inflation has risen sharply in recent years, from 2,7% in 2021 to 6,4% in 2022. The increase is also clearly visible in the high energy and gas prices. In addition, it is also noticeable in the wallet where groceries have become more expensive. If inflation rises too fast, the European Central Bank must intervene to counteract the increased inflation so that interest rates rise.
The European Central Bank
In the meantime, the European Central Bank has already taken firm action to limit the consequences of the corona crisis. Globally, there have been significant delays due to lockdowns and the shutdown of the entire economy due to the pandemic. The ECB assumes that these disruptions are temporary and that they may reverse once the supply problems are resolved.
Mortgage Interest Rates
Mortgage interest rates have already risen twice in recent weeks with approximately 0,5%. Rising interest rates have made borrowing more expensive. Lenders have been able to keep their rates the same for a long period of time, but that is now changing. Interest rates will continue to rise as the year progresses. The US is already one step further, the FED will raise the rates in three steps this year. This has direct consequences for interest rates in Europe. Furthermore, the unpredictability of the coronavirus ensures that the ECB continues to operate cautiously.
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