ECB cuts rate to 1.25%

Rabidlamb · 03-11-2011 02:31PM #1

Didn't take that new chap long.
I'm hoping it'll be down to 1% before Christmas.
What chance any of this being passed on to variables :rolleyes: ?

http://www.rte.ie/news/2011/1103/ecb-business.html

average_runner · 03-11-2011 02:34PM

Woohoo cut on my tracker.

Extra money to pay mortage off that bit quicker.

seamus · 03-11-2011 02:34PM

Oh sweet.

tracker mortgages.

Very quick move though by the new guy. He's obviously been formulating his own plans in the background for a while now and is eager to implement them.

n97 mini · 03-11-2011 02:40PM

0.25% saves me €9 a month on the mortgage. Woohoo!

bamboozle · 03-11-2011 02:49PM

great news, here's hoping for another drop in December!

fliball123 · 03-11-2011 03:08PM

lets hope they pass it on to struggling variable rate mortgage holders

Frank Black · 03-11-2011 03:13PM

fliball123 wrote: »

lets hope they pass it on to struggling variable rate mortgage holders

Or alternatively, we could be more realistic and accept that they won't.

andrew · 03-11-2011 05:55PM

It's unusual; Usually new Central bankers raise rates, to show that they're committed to low inflation (especially in the ECB).

Suryavarman · 03-11-2011 06:05PM

andrew wrote: »

It's unusual; Usually new Central bankers raise rates, to show that they're committed to low inflation (especially in the ECB).

These are unusual times though. With many countries leaning towards recession and the markets being rather volatile, the Central Bank will want to lower interest rates in the hope that cheaper credit will improve things.

Madd Finn · 03-11-2011 08:16PM

fliball123 wrote: »

lets hope they pass it on to struggling variable rate mortgage holders

In your dreams! We'll be subsidising those tracker bustards for some time to come!:mad:

irishh_bob · 03-11-2011 08:17PM

woo hoo , interest rate cut means a rise in gold price

WebGeek · 03-11-2011 08:20PM

black francis wrote: »

Or alternatively, we could be more realistic and accept that they won't.

Of course not -someone has to subsidize the trackers - so why not the ones who bought at the top of the boom and never got the chance to trade up from starter homes or get a tracker. Burden sharing anyone? - didn't think so.*Que moral police replies*

KELTICKNIGHTT · 03-11-2011 08:42PM

Be curious to see what banks pass it on.

woodoo · 03-11-2011 08:52PM

The banks may act up on this and call Elderfields bluff.

KELTICKNIGHTT · 03-11-2011 09:03PM

Think tsb only bank so far to say they would pass it on this month
Other banks will likely be slow to ,even mightened till next ecb rate drop.
Any drop in my mortgage is good.

Welease · 03-11-2011 09:52PM

WebGeek wrote: »

Of course not -someone has to subsidize the trackers - so why not the ones who bought at the top of the boom and never got the chance to trade up from starter homes or get a tracker. Burden sharing anyone? - didn't think so.*Que moral police replies*

Trackers were available well past the end of the boom... I picked up one in Dec 2007.

beertons · 03-11-2011 09:54PM

Crap. I applied for a mortgage today, with BOI.

thebman · 03-11-2011 11:29PM

beertons wrote: »

Crap. I applied for a mortgage today, with BOI.

Noonan ordered them all to do it or he'd get the financial regulator involved.

Presumably to shake their hands or get a free lunch on them or something :P

Anyway I'd expect the others to announce similar in the next few days, they each just want a headline each I imagine so will do it on separate days.

PTSB just got the early, free publicity on the matter making it look like they are the good guys.

johnnyskeleton · 04-11-2011 01:02AM

Does anyone else think that by Not passing this on to mortgage holders the banks would be acting in the best interests of the taxpayer?

No?

n97 mini · 04-11-2011 01:26AM

johnnyskeleton wrote: »

Does anyone else think that by Not passing this on to mortgage holders the banks would be acting in the best interests of the taxpayer?

No?

If what we're being told is true, then yes.

(We're being told that the banks are losing money on trackers, and need the margin on variable and fixed rate mortgages to cover the shortfall. We're also being told that we own AIB as well as a few other smaller institutions, and a large part of BoI)

Gumbo · 04-11-2011 11:14AM

WebGeek wrote: »

Of course not -someone has to subsidize the trackers - so why not the ones who bought at the top of the boom and never got the chance to trade up from starter homes or get a tracker. Burden sharing anyone? - didn't think so.*Que moral police replies*

I bought at the top of the hill in October 2006 and got a tracker from Bank Of scotland.

Tazz T · 04-11-2011 11:19AM

Well, the gov is saying they'll 'use their influence' to make sure the cut is passed on. Hope for a change this is not just rhetoric, cos they've done very little apart from break their electoral promises so far.

BTW, Madd Finn, I'm on a tracker and not a begrudger like you. I'm not subsidising your variable rate. The bank simply knows it can penalise you. You choose your service, you pay your price, matey! Don't blame me.

ardmacha · 04-11-2011 11:30AM

Interest rates for depositors exceed 3% and exceed 4% in many cases. This is more relevant than the ECB rate. Banks cannot lend it out for less than they take it in.

fliball123 · 04-11-2011 11:43AM

Madd Finn wrote: »

In your dreams! We'll be subsidising those tracker bustards for some time to come!:mad:

This kinda uneducated stupid comment drives me mad...how is anyone else subsidising a person with a tracker...

For example..

If I have a tracker and I owe 100 Euros and I pay back this 100 Euros with what ever interest then its obvious that I am subsidising my own mortgage to the full amount and paying interest...Its not the tracker mortgagees fault you didnt avail of it at the time

thetonynator · 04-11-2011 07:08PM

ardmacha wrote: »

Interest rates for depositors exceed 3% and exceed 4% in many cases. This is more relevant than the ECB rate. Banks cannot lend it out for less than they take it in.

Except they can loan out far more than they have on deposit, so really 0.3 or 0.4% would cover the interest for depositors.

WalterMitty · 04-11-2011 07:14PM

thetonynator wrote: »

Except they can loan out far more than they have on deposit, so really 0.3 or 0.4% would cover the interest for depositors.

Not so much with increased capital requirements and high funding costs for their funds.

halkar · 04-11-2011 07:18PM

Nothing to get excited for. Government will take whatever saved and more in the budget :mad:

Welease · 04-11-2011 07:35PM

fliball123 wrote: »

This kinda uneducated stupid comment drives me mad...how is anyone else subsidising a person with a tracker...

For example..

If I have a tracker and I owe 100 Euros and I pay back this 100 Euros with what ever interest then its obvious that I am subsidising my own mortgage to the full amount and paying interest...Its not the tracker mortgagees fault you didnt avail of it at the time

Thats not exactly true.. The banks don't borrow (or use deposits for) your total 100 at the interest rate on the day you take out the loan.. they will revolve cash through the system througout the effective term of your loan, and may in some cases be charged far more interest on your loan (or pay far more for cash on deposit) than they are able to charge you on a tracker based mortgage.

KELTICKNIGHTT · 04-11-2011 07:55PM

Welease wrote: »

Thats not exactly true.. The banks don't borrow (or use deposits for) your total 100 at the interest rate on the day you take out the loan.. they will revolve cash through the system througout the effective term of your loan, and may in some cases be charged far more interest on your loan (or pay far more for cash on deposit) than they are able to charge you on a tracker based mortgage.

I'M on variable and with ulster bank who said they wouldn't be passing cut on

bbsrs · 04-11-2011 08:23PM

Tazz T wrote: »

BTW, Madd Finn, I'm on a tracker and not a begrudger like you. I'm not subsidising your variable rate. The bank simply knows it can penalise you. You choose your service, you pay your price, matey! Don't blame me.

Well said . @Madd Finn how can people blame those on trackers for the situation they find themselves in and if there were no trackers don't think for a minute your mortgage would be any cheaper, the small ammount banks loose on trackers is nothing compared to what their wreckless lending to investors and greed cost them . The percentage of losses they have from residential lending is very small in comparison. Be angry at the banks not the individuals who bought a home and took what they thought was the right option for them. If interest rates had gone up significantly would those on fixed rates have said aww the poor trackers are getting crucified lets all swop to trackers to help them out ?

johnnyskeleton · 04-11-2011 11:19PM

n97 mini wrote: »

If what we're being told is true, then yes.

(We're being told that the banks are losing money on trackers, and need the margin on variable and fixed rate mortgages to cover the shortfall. We're also being told that we own AIB as well as a few other smaller institutions, and a large part of BoI)

We know that the banks are losing money hand over fist. If they can reduce those losses somewhat by, for example, having higher interest rates, I see no problem with that. Every extra €1 the banks charge on loans is €1 less the taxpayer will have to pay the banks. In theory, anyway.

ECB cuts rate to 1.25%

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