{"id":620513,"date":"2026-09-10T15:58:12","date_gmt":"2026-09-10T15:58:12","guid":{"rendered":"https:\/\/www.newsbeep.com\/ie\/620513\/"},"modified":"2026-09-10T15:58:12","modified_gmt":"2026-09-10T15:58:12","slug":"mortgages-in-the-firing-line-as-ecb-increases-interest-rates-by-0-25-percentage-points-the-irish-times","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ie\/620513\/","title":{"rendered":"Mortgages in the firing line as ECB increases interest rates by 0.25 percentage points \u2013 The Irish Times"},"content":{"rendered":"

The European Central Bank (ECB)<\/a> raised interest rates <\/a>by a further quarter point (0.25 per cent) on Thursday as conflict in the Middle East<\/a> stoked a fresh surge in energy prices.<\/p>\n

Policymakers also signalled they were ready to lift borrowing costs again if the inflation outlook does not improve.<\/p>\n

\u201cThe outlook remains highly uncertain, with risks to the upside for inflation and to the downside for economic growth,\u201d they said, while increasing their inflation forecasts for 2027 and 2028.<\/p>\n

The widely anticipated move, which lifted the ECB\u2019s main deposit rate to 2.5 per cent, will put further pressure on borrowers here.<\/p>\n

It also comes as separate figures from the Central Statistics Office indicate that mortgage interest repayments in Ireland have risen by 10 per cent in the last 12 months. <\/p>\n

A homeowner with a tracker rate on a \u20ac150,000 loan with more than 10 years left faces an annual increase of roughly \u20ac200 in their repayments as a result of Thursday\u2019s decision<\/p>\n

The latest hike will potentially impact variable rates offered by Irish banks in the months ahead and people coming off fixed rates are also likely to have to pay more.<\/p>\n

[\u00a0Irish mortgage holders warned to brace for \u2018tough winter\u2019 with two rate hikes expectedOpens in new window<\/a>\u00a0]<\/p>\n

While ECB president Christine Lagarde<\/a> has repeatedly insisted the bank is not on a predetermined rate path, financial markets are pricing in one more rate hike this year, \u200bfollowed by one or two moves next year.<\/p>\n

ECB officials believe another hike as soon as next month is possible, Bloomberg News reported.<\/p>\n

Policymakers are battling an increase in consumer-price inflation which rose above 3 per cent last month, an increase that is unlikely to recede in the months ahead. <\/p>\n

Lagarde said the latest hike was \u201ca no brainer\u201d that was decided unanimously.<\/p>\n

Repeatedly asked about market bets on future rate increases, she said \u201cmarkets do what they have to do, and we do what we have to do, which is to provide price stability.\u201d<\/p>\n

Lagarde repeated the bank\u2019s statement about the US\u2019s seemingly open-ended conflict in the Middle East continuing to generate inflationary pressures.<\/p>\n

\u201cThis is likely to keep headline inflation well above target into the first half of 2027,\u201d she said. Her tone was perceived by commentators as hawkish, signifying the ECB believes the inflation push is likely to persist.<\/p>\n

The central bank sees headline inflation averaging 3 per cent this year, 2.5 per cent in 2027 and 2.1 per cent in 2028.<\/p>\n

The projection for economic growth across the bloc was 0.9 per cent for 2026, 1.4 per cent for 2027 and 1.5 per cent for 2028 which the bank noted was an upward revision for both 2026 and 2027, \u201creflecting the greater than expected resilience of the euro area economy\u201d.<\/p>\n

\"\"From kitchen counter to supermarket shelves, the rise of Ballymaloe Foods<\/p>\n

Trevor Grant, chairperson of Irish Mortgage Advisors, said the State\u2019s 130,000 tracker mortgage holders would be first to feel the squeeze.<\/p>\n

\u201cIf you combine today\u2019s increase with the June rate hike, monthly repayments for a tracker mortgage customer are now between \u20ac24 and \u20ac28 higher for every \u20ac100,000 borrowed than they were prior to June 2026,” he said.<\/p>\n

\u201cWhile many borrowers will understandably be worried about today\u2019s announcement, it\u2019s important that they are not unduly alarmed. Competition and not the ECB is the main influence on home loan rates in Ireland,\u201d Grant said.<\/p>\n

Rachel McGovern of Brokers Ireland said the latest rate increase will also affect people coming off fixed rates.<\/p>\n

\u201cMany coming off rates now would have been on rates under 3 per cent and are coming out into a much higher interest rate environment,\u201d she said.<\/p>\n

Oil prices eased on Thursday but Brent \u2060crude remained above $100 (\u20ac86) \u200ba barrel as traders braced for deeper supply disruptions after Iran and the US launched their largest wave of attacks on shipping since their six-month-old conflict began.<\/p>\n

.<\/p>\n","protected":false},"excerpt":{"rendered":"The European Central Bank (ECB) raised interest rates by a further quarter point (0.25 per cent) on Thursday…\n","protected":false},"author":2,"featured_media":620514,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[72,14724,12965,61,5232,60,150432],"class_list":["post-620513","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-business","tag-christine-lagarde","tag-european-central-bank-ecb","tag-ie","tag-interest-rates","tag-ireland","tag-israel-iran-conflict"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/620513","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=620513"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/620513\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/620514"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=620513"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=620513"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=620513"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}