The Euribor, the main reference index for setting the interest rate on mortgage loans, closed the month of June at 0.852% and stood at its highest since August 2012, as confirmed by the Bank of Spain this morning. The Euribor index rose in June from 0.287% the previous month to 0.852%, which is 0.565 points more and has been on the rise for six months. The index registers a rise of 1,336 points, taking the last 12 months as a reference.
The hike comes after the European Central Bank announced an interest rate hike from 0% to 0.25% in July and a further hike in September that could lift rates to 0.75%. The Euribor is the interest rate at which banks lend to each other and its sharp rise anticipates precisely what the market expects to happen from now on. The era of free money is over.
This rise in the Euribor will mean an increase in the monthly fee for those who have to do the annual review of their variable-rate mortgage. Specifically, a 30-year variable mortgage of 150,000 euros and with a spread of Euribor 0.99% will suffer an increase in your monthly mortgage of 90.28 euros or, which is the same, 1,083.36 euros per year.
As for the new official interest rates that are now being published, the one-week Euribor stood at -0.57%, one-month at -0.525%, three-month at -0.239% and six-month at 0.162%. For its part, Bankinter’s analysis department forecasts that the 12-month Euribor will reach 1.9% in 2022 and 2.2% in 2023, later moderating to 2% in 2024. However, other experts they consider that it is too early to forecast the behavior of the index for the end of the year.
