What is Euribor, after all?

Euribor is the abbreviation of European Interbank Offered Rate, it is a reference rate that results in the average of the interest rates practiced by a group of European banks, regarding the loans they make between themselves.

The European Banking Federation establishes the reference interest rate on a daily basis through the average of the interest rates between certain European banks, this value relates to different periods: one week, one month, three, six and twelve months.

If you are going to take out a loan to buy a house you will have Euribor side by side in your negotiation, credit is influenced by the European Central Bank (ECB), that is, if there is a need for the ECB to stimulate the economy, the interest rates will tend to fall so that the currency becomes more accessible, otherwise if there is an intention to adopt more restrictive measures to combat and contain inflation, the rates will tend to rise.

The evolution of the Euribor rate is directly related to the rise or fall of the main interest rate of the ECB, if you have or plan to have a variable rate mortgage, the instalment you will pay will have the impact of Euribor.
In other words, the Euribor trend will dictate the interest rate trend of your loan.

Source: Supercasa | News