Even though Norway’s bank should cut interest rates tomorrow, it is doubtful that banks will follow.
Therefore, Held has to put down renta
There is a great expectation that Norges Bank will cut interest rates on Wednesday.
How to change bank
To proceed to a lower interest rate bank
The money market determines
The determination of the banks’ lending rate is determined by how much it costs banks to borrow money. The so-called and much-discussed management rate in Norges Bank is one factor. But an equally important, though perhaps more important element, is the so-called money market rate, also called 3-month NIBOR. This determines what it costs banks to borrow in between, and it has shot in the ceiling over the past month, as a result of major uncertainty in the financial world.
– The lending rate is based on what it costs the bank to raise funding – to borrow. The price of the fund is governed by the money market rate, not the policy rate. However, a possible reduction in the policy rate will hopefully have a positive effect on the money market, so that we will eventually get a lower lending rate, “says Communications Director at Fokus Bank, Bjørn Lenard Langli.
When Norges Bank holds its extraordinary monetary policy meeting tomorrow, market expectations are expected to be cut.
– We believe in a cut of 0.5 percentage points tomorrow, says macro economist at Handelsbanken, Shakeb Syed, which, however, adds that they are not completely obscure.
Should there be a cut, it is still not allowed for banks to cut their housing rates. It shows a call round Click has made to the largest banks.
– There is still great uncertainty about developments in the money market and the market situation in general. We must now closely monitor how the policy rate, other measures and developments affect the cost of raising money. Hopefully, the extremely high money market rates could come down and the measures help to avoid further increases in interest rates, says Nordea, Thomas Sevang, Information Manager.
– The interest rate on mortgage loans and deposits to personal customers is a consequence of the extraordinary situation in the market for banks’ lending. The interest rate increase we made last week does not fully reflect the increase in money market, says information director at DnB NOR, Aud-Helen Rasmussen.
Responsible editor of Your Money, Tom Staavi, said yesterday, based on the government’s crisis package, that banks should cut interest rates.
Staavi nevertheless accepts that banks take a pending attitude in the light of the instability in the money market.
– I understand that banks must see a stabilization of market rates at a lower level before making their changes. In fact, the banks have stayed a little way back here because they probably did not believe that the sky-high market rates should last for as long as it has ever worsened.
Your Money Editor, for whatever reason, sees no reason for being a bank customer and waiting for banks to reduce interest rates.
Here, as always, it’s important to be a constructive, critical banking customer and make sure that your own interest rate falls in line with developments in the money market. If this presumption takes longer than it should, there are many banks in Norway.
How to get the lowest possible mortgage rate.