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Interest rates

29 Sep 2020

The housing market is a complex entity that can confuse most Americans, especially when considering the various factors that influence it. Further adding to this entanglement that consumers must unravel are the impacts from the COVID-19 pandemic.

Millennials are the generation known as the tech generation, the echo generation, along with other monikers. However, they’re also known for their reluctance to buy homes. There have been many reasons for this trend among millennials, according to BBVA USA Head of Mortgage Banking Murat Kalkan.

08 Apr 2020

04 Oct 2019

The reform of the reference rates in the euro area to adapt to new regulations, promoted by the European Central Bank (ECB) along with other authorities, is taking shape. On October 2, the ECB began publishing a new overnight rate: the €STR.

31 Jul 2019

26 Jul 2019

09 Apr 2019

27 Nov 2018

17 Sep 2018

As widely expected, the ECB concluded its monetary policy meeting yesterday without making any changes to its monetary policy stance. As BBVA Research’s ECB Watch report notes, there were other key takeaways that came out of the meeting, such as the end of the Asset Purchase Programming, and the confirmation that the bank is in no rush to hike interest rates. From an economic standpoint, the institution affirmed its inflation outlook but slightly lowered its growth expectations for the euro zone.

13 Sep 2018

The Central Bank of the Republic of Turkey (CRBT) decided today to raise the official interest rate by 625 basis points from 17.75 percent to 24 percent. As a BBVA Research report points out, the hike came in above market expectations (21 percent according to Bloomberg consensus estimates), and BBVA Research’s own forecast (22.75 percent). BBVA Research welcomes the move and believes it should be backed up by a medium-term coherent and detailed fiscal plan.

27 Jul 2018

The European Central Bank on Thursday announced it is maintaining its monetary policy unchanged. Interest rates will remain at current levels until the summer of 2019 or “as long as necessary”, as announced in its June meeting. In doing so, ECB President Mario Draghi gave no further clarification on the next steps in the bank’s roadmap and intoned the mantra of prudence and patience.

11 Jun 2018

Over the past several years, the Federal Open Market Committee (FOMC) has gradually increased the federal funds interest rates both as a response to favorable economic conditions and in order to curb inflation. In a rising interest rate environment such as this, lending is affected as banks set their own interest rates according to the prime rate, which is mostly determined by the aforementioned federal funds rate.

09 Mar 2018

As expected the European Central Bank (ECB) yesterday took a further step toward the normalization of its monetary policy. That is BBVA Research’s reading of the situation in its ECB Watch report. The institution headed by Mario Draghi left interest rates unchanged and will continue with its asset-purchasing program, commonly known in English as quantitative easing (QE). The main development that emerged from the policy meeting was the dropping of the “explicit reference” to the possibility of increasing the size of the program. And that already represents a change.

02 Feb 2018

26 Jan 2018

As had been expected, following its monthly meeting the European Central Bank left interest rates unchanged. At the same time, ECB President Mario Draghi introduced the exchange rate as an element of uncertainty, stressing that he will monitor the fluctuations in the euro and their possible consequences. Likewise, he reiterated the possibility of broadening the bond purchase program, continuing his accommodative policy, which will be accompanied by interest rates at minimum levels for a long period of time.

25 Jan 2018

26 Dec 2017

The beginning of the normalization of monetary policy in 2018 should bring greater profitability for banks, a larger investor appetite and a positive outlook for the stock market. However, what is perhaps more important, the new policy will enable banks to meet one of their principal goals: supporting economic growth by financing companies and private individuals.

02 Nov 2017

A swap is an agreement for a financial exchange in which one of the two parties promises to make, with an established frequency, a series of payments, in exchange for receiving another set of payments from the other party. These flows normally respond to interest payments based on the nominal amount of the swap.

19 Oct 2017

21 Jul 2017

Mario Draghi did not surprise anyone yesterday. As expected, the European Central Bank (ECB) unanimously decided to leave interest rates unchanged. He also did not announce any immediate changes to the asset purchase program. However, he did offer some clues as to the direction the ECB will follow after the summer.  As BBVA Research notes in its ECB Watch report, the discussion on gradually tapering QE (Quantitative Easing, the ECB´s asset purchase program) will take place in the fall – most likely in September.

20 Jul 2017

09 Jun 2017

As the markets expected, at its June meeting the European Central Bank (ECB) closed the door on further interest-rate cuts and adopted a more neutral stance on risks, although maintaining caution. Despite the fact that the institution has not yet given signs of taking a step to exit the current monetary policy, the ECB Watch report published by BBVA Research suggests that in September it may announce a slowdown in asset purchases starting in 2018.

26 May 2017

21 Mar 2017

14 Mar 2017

10 Mar 2017

Mario Draghi did not announce any new changes in monetary policy at Thursday’s press conference, but the latest European Central Bank (ECB) meeting did lead to some updates. On the one hand, the ECB is more optimistic about economic growth. On the other, it is raising its 2017 inflation forecast to 1.7% (from 1.3% in December) due to growing energy prices, but it barely changed its core inflation projection. And last, but not least, it added some nuances to its wording, which could be the prelude to changes in its monetary policy,  BBVA Research notes in its ECB Watch report.

16 Feb 2017

13 Feb 2017

30 Jan 2017

In Barcelona today, BBVA’s Executive Director José Manuel González-Páramo reflected on the factors that have influenced the current context of low, and even negative interest rates in developed economies. BBVA’s Executive Director shared his vision of what has led to this environment, the impact it is having on the markets and above all, where we are headed. In his opinion, low interest rates will remain for an extended period of time.

González-Páramo participated in the 25th anniversary of Inverco Catalunya where President Carlos Tusquets gave the opening speech. In his presentation titled, “Low interest rates: Where we are coming from, the impact and where we are going” BBVA’s Executive Director underscored that debate is currently focusing on estimating the amount of time low interest rates will remain, what will be the new equilibrium and what policies and strategies are appropriate for a change in trend.