10 year low for EU Central Bank rates

The EU central bank today confirmed that it was keeping its rates steady at 1.00%. This rate has been in effect since May of this year and continues to provide support for French property prices which remain stable according to the November press release from the FNAIM, the national Federation of estate agents in France. Average property prices rose in October by 0.6% and the overall drop in the average price of French apartments and houses is now reckoned at 5% for the year. With the Eurozone and France both now having exited the recession and showing signs of growth the outlook is positive for rates for mortgages in France and French property prices.Although the news today came as no surprise, it is interesting to see that the general consensus for the way in which the French mortgage market...

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EU inflation and French mortgages

With the news today that inflation has return to the Eurozone, what does this mean for the outlook for interest rates for French mortgages? The increase in consumer prices for the month of November marks the end of a five month cycle of deflation across the European economic area. The 0.6% rise was driven largely by rises in energy prices which are common at this time of year but exacerbated by the returning trend for oil speculation with traders finding it cheaper to store the oil and to take orders for delivery in six months time. This practice serves to drive up the prices but reducing the supply in the face of increasing demand as oil consuming companies look to hedge against rising costs.This increase in inflation will increase pressure of the ECB to raise the rates for French mortgages...

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