ECB Rate drop - Wrinkle me this batman?

Mr_Incredible

So if the ECB interest rate is -0.15%

Surely as we are European members, our UK banks can borrow and turn this low interest rate onto th home mortgage borrowers, i.e. chaeper lending rates?

Yes?

Thrugelmir

Borrow from where?

Banks are reducing exposure to mortgage lending not increasing.

ACG

I might be wrong but isnt it only that rate if it is being lent to businesses?

Either way, you can get mortgage interest rates under 2% now... how much lower are you wanting them to go before banks become a charity?

TrickyDicky101

That's the rate the ECB 'pays' for overnight deposits (ie it charges institutions for the privilege of depositing money with it). It has no direct relevance to the mortgage rate you pay.

Mr_Incredible

TrickyDicky101 wrote: »

That's the rate the ECB 'pays' for overnight deposits (ie it charges institutions for the privilege of depositing money with it). It has no direct relevance to the mortgage rate you pay.

A single intelligent response, I'm floored:T

BillJones

Mr_Incredible wrote: »

So if the ECB interest rate is -0.15%

Surely as we are European members, our UK banks can borrow and turn this low interest rate onto th home mortgage borrowers, i.e. chaeper lending rates?

Yes?

That's the rate that banks can deposit at, not the rate at which they can borrow.