Will Ireland’s mortgage rates fall or rise after the pandemic?

Ireland’s high-interest rates have long been an issue. Although some financial and legal concerns will ensure that they remain above average, overall interest rates may and should be reduced. New and existing borrowers might save thousands of dollars in interest payments throughout their mortgage. This is especially true for existing borrowers who are already paying interest rates of 3 to 3.5 percent. Many people may convert to rates closer to 2%, saving them a lot of money throughout their loan. According to Brokers Ireland, Irish mortgage holders now pay more than twice what most of their competitors do.

The NTMA increased its borrowings for Ireland at negative interest rates for seven and ten years, keeping interest rates on international markets at historic lows. Still, borrowing costs in Ireland are always in line with those in the rest of the EU; mortgage rates are still generally low. Because of the present recession, interest rates have been maintained low. But how long can it go on? Is this a paradigm shift for us?

The following are the most crucial points: Maintain …

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European stimulus plans

The ECB meeting is due to meet this week on the 7th and a further 0.25% rate cut is expected which will bring European base rate lending to 1% which is the lowest it will go according to guidance given in the past by Jean Claude Trichet. For mortgage holders this will be a further advantage for those on tracker mortgages and for those who hold variable rates where the cut is passed on.

The question currently is whether or not there will be any stimulus packages mentioned or any idea on what to expect in the coming months, with very concise plans afoot in the US, UK, China, and elsewhere it is likely that the Eurozone will need to make some formal plan as well and move beyond the monetary options of only playing with interest rates.

The EU has a problem other currency zones don’t, that of political cohesion, the USA is all dollar denominated and all under one flag, the UK is the same, as is Japan, …

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Fed and ECB rates: What comes next?

It looks like the ECB will keep its rates where they are, the Fed is likely to cut their rates. I made a prediction that the US rates would go lower, down as far as 3.5% perhaps. The Fed rate won’t hit 3.5% this time but its only January! I have until December to be proven wrong! And if I am wrong I’ll do another roud up story of whether or not I’m an idiot.

On a seperate The Dow Jones has had it worst year start since 1904, the Nasdaq had its worst since 1971. A fear that a market driven by consumer spending won’t last is causing any stocks tied to these sectors to fall off.

It might be a good time for to move away from stocks and get into cash for two months to see how this plays out.

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