### Summary
Tracker mortgage holders in Ireland have been facing increasing interest rates, with the European Central Bank (ECB) expected to raise rates even further. Consumers are advised to consider fixed rate options to protect against future rate rises.
### Facts
- The interest rate for tracker mortgages has risen from 2% in 2005 to 4.9% currently.
- The ECB has implemented nine rate rises in the past 13 months, with one more expected this year.
- Many borrowers did not take advantage of the low fixed rates available, leaving them exposed to higher rates when their fixed terms expire.
- Banks in Ireland receive mortgage funding from savers, allowing them to refuse depositors the benefit of ECB rate rises.
- Affordability and the likely direction of interest rates should be considered when deciding between a tracker or fixed rate mortgage.
- The best fixed rate options currently available for switchers are Avant's three-year fix at 3.6% and Haven's four-year green mortgage fix at 3.65%.
- The future direction of interest rates is uncertain, but the current market view suggests there may be at least one more rate rise.
- Switching from a tracker mortgage may not offer substantial savings at this late point in the interest rate cycle.
- Consider using the calculators on the Competition and Consumer Protection Commission website and consulting a mortgage adviser before making a decision.
Homebuyers looking to secure a lower mortgage interest rate in today's market can do so by improving their credit score, buying mortgage points, or locking in a rate.
The Bank of England is predicted to make only one more increase to Bank Rate, taking it to 5.50% in September, despite other major central banks halting rate hikes, as the BoE struggles to control inflation.
The Bank of England may have to increase interest rates if the US Federal Reserve decides to raise rates to cut inflation, in order to prevent the pound from weakening and inflation from rising further.
The Bank of Canada is expected to keep its key interest rate steady at 5.00% and maintain that level until at least the end of March 2024, despite rising inflation and a revival in the housing market, according to economists in a Reuters poll.
Surging interest rates in the UK have led to a slump in factory output, the biggest annual drop in house prices since the global financial crisis, and signals of distress in different sectors of the economy, posing a dilemma for the Bank of England as it decides whether to raise interest rates further.
The Reserve Bank of Australia is expected to keep its key interest rate unchanged at 4.10% as inflation slows, but economists anticipate a final hike in the next quarter.
The Bank of Canada has decided to keep its key overnight interest rate at 5% due to weaker economic growth, but stated that it may raise borrowing costs if inflationary pressures persist.
The Federal Reserve is expected to keep its benchmark overnight interest rate unchanged and delay any rate cuts until at least 2024, according to a Reuters poll of economists, despite some suggesting that another rate hike might be needed to address inflation.
The value of UK mortgage arrears has increased by almost a third in April-June compared to the same period last year, reaching its highest level since 2016, due to rising mortgage costs caused by multiple interest rate hikes by the Bank of England. While some experts predict a rise in defaults, others argue that the number of people unable to repay their mortgages remains relatively low.
The Bank of England may raise interest rates to 5.5% this autumn due to inflation remaining above target, potentially putting further financial strain on homeowners, while households on low incomes will receive cost of living support payments from the government totaling up to £1,350 this year, and the Energy Price Cap has dropped again to £1,923 for the final quarter of the year.
The European Central Bank is facing a dilemma on whether to raise its key interest rate to combat inflation or hold off due to economic deterioration, with investors split on the likelihood of a rate hike.
Traders and investors are betting that the Federal Reserve will hold interest rates steady at its September meeting, indicating a shift in the market's interpretation of good economic news, as it suggests the Fed may be close to pausing its rate hike cycle despite inflation being above target levels and potential headwinds in the economy.
Mortgage rates continue to rise, reaching an average of 7.18% for 30-year fixed-rate mortgages, as experts remain divided on whether the Federal Reserve will raise interest rates further.
The Federal Reserve is expected to keep interest rates unchanged at its upcoming meeting, but market participants will be closely watching for any hints regarding future rate cuts.
Following the European Central Bank's record high interest rate hike to 4%, there is speculation about how long rates will remain at this level, with analysts predicting a 12-month pause before any cuts are made, while also considering the impact of rising oil prices on inflation expectations in Europe and the US. The Federal Reserve is expected to hold rates steady in September, but there are divided opinions on whether another hike will be delivered this year, with markets anticipating rate cuts in 2024. Similarly, the Bank of England is anticipated to make one final hike in September as it assesses inflation and economic indicators.
The Federal Reserve is expected to hold off on raising interest rates, but consumers are still feeling the impact of previous hikes, with credit card rates topping 20%, mortgage rates above 7%, and auto loan rates exceeding 7%.
The Federal Reserve is expected to announce a pause on interest rate hikes due to positive economic indicators and the likelihood of a "soft landing" for the economy, but future decisions will be influenced by factors such as the resumption of student loan payments and a potential government shutdown.
The Federal Reserve is expected to hold its benchmark lending rate steady while waiting for more data on the impact of previous rate hikes on the US economy, but there is still a possibility of another rate increase in the future.
Inflation in Britain slowed for a third consecutive month in August, defying expectations of a rise due to higher fuel prices, with consumer prices rising 6.7 percent compared to the previous year, driven by slower increases in food prices and a decline in hotel room costs. Core inflation also fell more than anticipated, indicating a potential easing of inflationary pressures, though price growth remains uncomfortably high. The Bank of England is set to announce its decision on interest rates, with growing speculation that rates may be held steady due to signs of slowing inflation and a weak economy.
The Federal Reserve has decided to keep interest rates steady, giving borrowers a break after 11 rate hikes and aiming to tame inflation while avoiding a recession.
The prospect of the Bank of England pausing its interest rate hikes increased as the UK's high inflation rate unexpectedly slowed to an 18-month low, causing the pound to fall and investors to see a nearly 50-50 chance of rates staying on hold at the BoE's September meeting.
The Swiss National Bank keeps interest rates unchanged at 1.75% and hints that further tightening may be necessary to ensure price stability, while also warning of a possible global economic slowdown and addressing the risk of energy shortage in Europe.
The Bank of England has opted not to raise interest rates for the first time in nearly two years, as inflation in Britain unexpectedly slowed and officials warned that the battle against persistent inflation is not yet over.
UK homeowners are feeling the strain as interest rates remain high, with many struggling to afford increased mortgage payments and considering drastic measures such as taking in lodgers or canceling expenses in order to make ends meet.
The Federal Reserve has paused its campaign of increasing interest rates, indicating that they may stabilize in the coming months; however, this offers little relief to home buyers in a challenging housing market.
The Bank of England has decided to halt interest rate rises due to unexpected inflation slowdown, while housing markets in major global economies, including the US, Germany, and the UK, are showing signs of slowing down. Additionally, there have been developments in various countries' economic outlooks and key interest rates.
The Federal Reserve's decision to hold interest rates and the possibility of rates remaining higher for longer may have triggered a sell-off in the US equities and cryptocurrency markets, with risk assets typically underperforming in a high-interest-rate environment.
The Bank of England's decision to hold interest rates is beneficial for borrowers but negatively impacts savers, who are losing out on higher returns from fixed-rate savings bonds. However, analysts predict that rates may not increase further, making it a good time for savers to secure a fixed-rate bond with high returns.
UK lenders are expected to reduce mortgage rates following the Bank of England's decision to keep interest rates unchanged, potentially leading to a mortgage price war among banks and building societies. However, consumer champion Martin Lewis warns that attractive fixed-rate savings accounts may soon have lower rates.
Investors are becoming increasingly concerned about sustained high interest rates, with the bond and foreign-exchange markets already showing signs of adjusting, and if stock markets do not follow suit, the coming months could be particularly challenging.
Mortgage approvals for house purchases have reached a six-month low in August, signaling a decline in lending and making it harder for buyers to secure homes due to rising interest rates; however, there is still hope that the market can recover if the Bank of England stops increasing interest rates and both buyers and vendors become more realistic.
Markets are increasingly expecting a Fed pause in interest rate hikes, with the chance of a rate increase in November dropping to 15.8%, down from 23.1% a week ago and 38.4% a month ago, as volatile Treasury yields play a major role in shaping market expectations.
The UK economy's marginal growth in August has led to expectations that interest rates will remain unchanged next month, with analysts describing the figures as lacklustre and warning of the negative impact of higher borrowing costs and the higher cost of living on consumers and businesses. The economy is currently not in recession but concerns over weak growth persist, making it a key issue in the upcoming election.
The U.S. Federal Reserve is expected to keep its key interest rate unchanged on November 1 and may delay rate cuts until the second half of next year, according to a Reuters poll of economists.
The Bank of Canada is expected to announce that it will hold interest rates, with no further rate hikes expected for the remainder of the year, according to experts. Homeowners with variable-rate mortgages or home equity lines of credit should be cautiously optimistic, while those considering fixed-rate mortgages should consider submitting a rate hold this week. The real estate market has been affected by the higher rates, as shown by a decrease in home prices and an increase in listings.
The Bank of Canada is expected to hold interest rates at 5.00% for at least six months, with economists predicting a reduction in the second quarter of 2024 due to a slowing economy and signs of strain from previous rate hikes.
