The European Central Bank has again increased the key interest rate. The key interest rate has risen to its highest level since December 2008. The increase is basically good news for bank customers. FOCUS Online says what now applies to loans, the savings book and money market accounts.
The European Central Bank (ECB) raised the key interest rate in the euro area by a further 0.5 percent. After much hesitation, the Governing Council of the ECB raised interest rates in the euro area for the first time in eleven years at its meeting on July 21.
It is the third interest rate hike to combat record inflation and further interest rate increases are likely: The ECB Council is assuming “due to the significantly upward correction of inflation prospects” that it will continue to raise interest rates, the central bank announced in Frankfurt. However, rising interest rates are not always positive.
Negative interest rates will finally disappear. As early as August, many financial institutions had gradually begun to reduce negative interest rates on overnight and fixed-term deposit accounts. Now interest rates could continue to rise.
Savers can hope for higher interest rates for the savings book, fixed-term deposit or call money account.
In view of the rapid rise in interest rates, classic investments such as overnight and time deposit accounts are becoming more attractive. For example, the first banks have increased interest rates, especially for short, but also for medium terms. A momentum that could even accelerate over the next year.
Two percent and more interest for a two-year fixed deposit could be possible.
A look at the interest rate comparisons from FOCUS Online shows how much the interest rate landscape has already changed. For overnight money, consumers can currently get 0.55 percent interest per year at Renault Bank. There, the French deposit insurance protects deposits of up to 100,000 euros. In the FOCUS Online fixed deposit comparison, the current leaders Illimity (Italy) and Payray (Lithuania) each offer 1.9 percent for an investment period of just twelve months. For two-year time deposits, the two banks mentioned even pay 2.05 percent per annum.
In contrast to interest on savings, lending rates are likely to continue to rise.
“Rising market interest rates are usually passed on directly to customers here,” says Philipp Rehberg from the Lower Saxony Consumer Advice Center, for example. This affects consumers both in the case of real estate and overdraft facilities (Dispo) and consumer loans.
The consumer advocate recommends keeping an eye on expensive overdrafts and only using them in the event of short-term financial bottlenecks. In the long term, normal consumer credit usually makes more sense.
In the case of expiring real estate loans, the question now arises as to how things will continue after the end of the fixed interest rate period. However, nobody can predict with certainty how construction interest rates will develop in the medium and long term, says Rehberg.
Whether a forward loan – i.e. the early commitment to follow-up financing at a fixed interest rate – makes sense must be decided on a case-by-case basis. “The primary goal should always be to secure the financing so as not to jeopardize the preservation of the property,” says the consumer advocate.
The account is overdrawn quickly. Balancing it out often takes much longer.
Some people even make a living out of the minus. But that will be expensive. Banks and savings banks can be well paid for the use of the so-called overdraft or overdraft facility – with interest.
If the key interest rate rises, these interest rates also rise.
If it is foreseeable that you will not be able to pay off your overdraft facility within a few months, you should speak to the bank and make a so-called repayment agreement.
This replaces the expensive overdraft facility with a cheaper loan – such as an installment loan.
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