The European Central Bank (ECB) is unlikely to apply negative interest rates at the end of the third quarter. ECB President Christine Lagarde wrote this on Monday in a blog on the central bank’s website. Lagarde reiterated that she expects bond purchases under the APP program to be stopped “very early” in the third quarter. “This would allow us to raise interest rates at our July meeting, in line with our forward guidance. Based on the current outlook, we are likely to be able to get out of negative interest rates by the end of the third quarter,” Lagarde said. If it then becomes clear that inflation is stabilizing at 2 percent over the medium term, a gradual further normalization of interest rates towards neutral rates is appropriate, she believes. Lagarde warns that the extent and pace of normalization cannot be determined in advance.
Existing owner-occupied homes in the Netherlands have also become considerably more expensive on an annual basis in April. This was reported Monday by Statistics Netherlands and the Land Registry. Houses were 19.7% more expensive in April than a year earlier. One month earlier, the increase was 19.5%, while in February the increase was 20.2% and in January 21.1%. At the time, that was the largest increase in prices since the first measurement in 1995. Since June 2013, there has been an upward trend. Compared to June 2013, prices were almost 96% higher in April. The Land Registry announced that it registered 15,972 housing transactions in April. That is almost 16% less than a year earlier. In the first four months of this year, 59,895 homes were sold, 30% less than in the same period of 2021.
The German business climate unexpectedly rose in May. This was revealed on Monday by the research institute Ifo. The Ifo index for the German business climate for industry and trade rose from 91.9 in April to 93.0 this month. Economists had previously counted on an index reading of 91.2. The sub-index for the current situation registered at 97.3, and for the future development the sub-index went to 86.9.
The 6M Euribor increased with 2 basis points to -0.08% compared to previous business day. The 10Y Swap increased with 6 basis points to 1.73% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
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