Cyprus banks ready to adjust interest rates immediately after ECB reduces base rate, association says

16:12 - 10 December 2024

Financial Services

The Association of Cyprus Banks has expressed its readiness to adjust interest rates tied to the European Central Bank’s (ECB) base rate immediately after the ECB’s forthcoming meeting on 12 December.

This move will directly impact the monthly instalments of their clients’ loans, the association said in a statement.

The association pointed out that the ECB is set to hold its final meeting for the year, with the majority of central bankers indicating a likely new rate cut.

“Should a further reduction be decided, it will mark the fourth rate easing since June, with the cumulative decrease exceeding 1 per cent, providing relief to borrowers and businesses,” the association said.

Moreover, the association mentioned that thousands of borrowers with loans linked to the ECB’s base rate will see their instalments reduced without delay.

It also stated that “the ECB’s interest rate reductions, following the containment of inflation, signal lower borrowing costs and indirectly boost economic growth”.

According to recent reports, the ECB is expected to reduce its deposit rate by 25 basis points (bps), equivalent to 0.25%, at its meeting on 12 December.

Cyprus banks ready to adjust interest rates immediately after ECB reduces base rate, association says

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