Highest average mortgage rate in 11 years

The handle of ECB (European Central Bank) has an impact on the economy and creditworthiness.

According to the latest monthly reportAbiAs the ECB raises reference interest rates, loan interest rates in Italy continue to rise. The average interest rate on new home purchase transactions was 4.29%a slight increase compared to July and the highest since April 2012.

In August, the average interest rate on total loans was 4.48%, compared to 4.42% in July, an escalation that results Sharp decline in loans to businesses and families.

The financing in August they fell by 3.3% compared to the previous year, reinforcing the trend already recorded in July, when they fell by 2.2%. The decline particularly affects companies (-4.0%).

Net loans of non-performing loans are also increasing and amounted to 16.5 billion euros in July, an increase of 2.2 billion.

The ABI bulletin from September also makes this clear the price charged for new copies Fixed-term deposits (i.e. certificates of deposit and term deposits) in August 2023 continued to grow and reached 3.36%, 307 basis points above the 0.29% recorded by this article in June 2022 (last month before the European Central Bank interest rate hikes). In July 2023, this rate in Italy was 3.28%, above the euro area average (3.15%).

Even in August Average interest rate for total deposits (certificates of deposit, savings deposits and current accounts), increased to 0.80%. The interest rate for current account deposits alone has risen to 0.40%, although, according to the Abi, it should be taken into account that the current account enables the use of a variety of services and does not have an investment function.

According to the banking association, the impact of the restrictive monetary policy initiated by the ECB over a year ago is also evident on broader economic aspects, for example in the negative change in Italy’s GDP in the second quarter and the decline in industrial production. And these effects “are also evident in the banking market in Italy,” says the Abi.

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