Euribor Hits Highest Monthly Level Since July 2024 Amid Rising Inflation Expectations
Euribor has risen for a third straight month, reaching its highest monthly level since July 2024. The September average is 3.247%, an increase from August's 2.954%. This rise puts more pressure on variable-rate borrowers at their next review.
The European Central Bank (ECB) raised all three key interest rates by 25 basis points on September 10, which is cited as the immediate trigger for the Euribor rise. Markets have also raised expectations for how high rates may go and how long they may stay high while inflation remains under control.
The ECB's decision linked the rate hike to its aim of bringing inflation back to its 2% medium-term target. Spain's inflation rate has added to this pressure, with the consumer price index rising to 4.9% in September. Kelisto analysts expect the Euribor to finish the year between 3.1% and 3.3% if energy prices ease.
However, HelpMyCash mortgage analyst Miquel Riera links the September increase to the return of inflation and the possibility of another ECB move. He also notes that the conflict in the Middle East could affect the benchmark in the coming months.