Interbank rates have today reached new maximums in more than fourteen years in its main terms. The 12-month Euribor, which also acts as a benchmark for mortgages, has risen this Wednesday, March 1, to 3.742%, 2 basis points more than on Tuesday and its highest price since December 4, 2008. With this The only data available as an average for March, the interannual differential of the index is already close to 400 basis points, the highest jump in history.
The latest upward spurt for the indicator comes from the rebound registered in the CPIs for February in Spain and France, two of the largest economies in the euro and the regions in which headline inflation had fallen the most in recent months. The step back in price stability also reveals pressure on the base, which excludes the most volatile items such as energy and food, which grew the most. The report puts more pressure on the ECB to hold on to funding conditions and cool demand.
The 12-month Euribor already discounts a rise in official interest rates of three-quarters of a point for that term, up to 3.75%, by the European Central Bank (ECB). The issuing institute has reiterated several times since December that it will raise the main financing rate by 50 basis points, to 3.5%, on March 16, but it has advanced -as Lagarde said on February 2- that in its meeting of May could also raise them again, a possibility that is gaining weight among monetary policy experts.
Investment bank Goldman Sachs has raised its rate hike estimate for the second time in a week, saying it now expects rates to rise 50 basis points (bp) at the May ECB meeting, sending money prices down. would be at 4%. Last week, in a report led by Jari Stehn, Goldman’s chief European economist, the bank predicted a 50bp rise in March, a 25bp rise in May and a 25bp rise in June. Now I think that the policy will be more aggressive in the short term.
Although the Euribor began to rise in February 2022 when the ECB opened the door to raising rates at some point in the year, it was not until April of last year that it traded positive for the first time in more than six years. The central bank raised rates for the first time in July, although the Euribor was already discounting the rise by more than that and was trading with a spread of more than 100 basis points. Now it is again moving 75 basis points ahead of the central bank’s official rate.