How does the mortgage interest rate develop in October? We have listed the most important market developments for our interest rate expectation, this time with various falling trends.
Mortgage interest rates fell slightly in September as a result of falling market interest rates . These have fallen again because inflation rates in the Eurozone have been disappointing since May.
Governments respond to low inflation by keeping policy rates low . This makes it attractive to consume (instead of saving), which leads to more economic growth and (hopefully) rising inflation.
Statements by policy makers
In the past month, important policy makers have expressed their views on economic development:
- ECB: despite far-reaching crisis measures, the Good Finance has been unable to achieve the desired inflation of 2%. In August inflation was only 0.2%. Falling raw material prices are the biggest concern. Analysts even see the chance that Draghi will intensify the support program.
- FED: in the US people are more positive about the domestic economy. Yet the Federal Reserve, the American umbrella of central banks, keeps interest rates low. In this way they want to prevent economic growth from being jeopardized by developments in the Eurozone and China, among other things.
The economic figures and statements of the policy makers have a paralyzing effect on the stock market . Investors fear a cooling of the world economy. In addition, the stock market crash in China has barely been processed and the car industry is a new concern .
Mortgage interest in October
We therefore see no reason to adjust our interest rate outlook for September. Mortgage interest rates will remain at the current low levels in October and possibly fall slightly. Tip: register for the Interest Rate Flash and follow the mortgage interest closely .
Interest rate rises remain visible
An interest rate hike was not delivered by the Fed in September. It is therefore not inconceivable that interest rates will rise later this year. There are also (distributed) positive economic reports that investors can respond to. An interest rate rise, although further afield, is still in the picture .