The positive effects of the first rate cut after the sudden increases that began in July 2022, they will be felt by families, businesses and the State. There will be immediate relief for those who have fallen into debt, for example, to buy a house with a mutual to variable rate. The parameter to look at carefully is the Euribor, the rate at which banks exchange money with each other and which constitutes the main parameter on which the variable mortgage rate is built. The Euribor immediately adapted to the decisions of the Central Bank, and the one-month rate fell to 3.68 percent, while the three-month rate stood at 3.75 percent. According to estimates from Mutuionline.it, on a loan of 250 thousand euros for the purchase of a house, the savings could reach 37 euros per month. A saving very similar to that calculated by Facile.it, which provides for a reduction in the monthly installment of 18 euros on a mortgage of 126 thousand euros, which could rise to 37 euros in December.
ECB, rate cut by 25 basis points: first time since 2019. BTP, 10-year yield rises to 3.87%, spread up
The rate cut, but above all the prospects that the ECB will continue on a path of monetary easing, affects not only the cost of existing mortgages, but also those offered by banks for the purchase of new homes. According to a Fabi study, based on expectations of a cut from the ECB, rates have already decreased from the average levels of 5 percent in 2023 to 3.68 percent. Now they could drop further to 3.45 percent. On a mortgage of 200 thousand euros for a duration of 25 years, the overall savings would be 62 thousand euros.
The benefits will not just be for families. Businesses will also be able to finance themselves at lower rates. «As regards business credit», explained Simone Capecchi, Simone Capecchi, Executive Director of Crif, «the high level of interest rates was one of the factors that had the greatest impact on Italian SMEs. The decision to cut, “he said, is a turning point.” And the same also applies to the State, given the need to place large quantities of public securities. Not only. The rate cut, as Lando Maria Sileoni of Fabi pointed out, will boost GDP. It is no coincidence that yesterday the Minister of Economy Giancarlo Giorgetti was among the first to applaud the first rate reduction (“a necessary decision, we hope that the cut is only the first step”, he said).
THE PASSAGE
The question many are asking at this point is how many more cuts the European Central Bank will make this year. Governor Christine Lagarde did not go unbalanced. In the usual press conference you reiterated once again that decisions will be made from time to time based on data. It will therefore be necessary to look at the trend in inflation and in particular at wages and the performance of services. The cost of living is proving stickier than expected. Inflation has reared its head in the last month, and the ECB has revised all its estimates upwards.
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