Euribor rates are reaching new highs and 12-month rates are over 4%.

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Three-, six- and twelve-month Euribor rates today reached new highs since December 2008 and, in the longer term, levels above 4%, after the ECB raised rates for the eighth consecutive meeting.

The 12-month Euribor rate, currently the most widely used in Portugal for variable-rate mortgages, rose today to 4.020%, up 0.055 points on Thursday and a new record high since December 2008.

According to March 2023 data from the Bank of Portugal, 12-month Euribor accounts for 41% of outstanding permanent variable-rate home loans. The same data show that six- and three-month Euribor rates account for 33.7% and 22.9% respectively.

The average 12-month Euribor rate rose from 3.757% in April to 3.862% in May, an increase of 0.103 points.

The six-month Euribor rate, which entered positive territory on June 6, 2022, rose today to 3.822%, an increase of 0.004 points and a new high since December 2008.

The average six-month Euribor rose from 3.516% in April to 3.682% in May, an increase of 0.166 points.

Similarly, three-month Euribor rose today to 3.572%, an increase of 0.025 points and a new high since December 2008.

The average three-month Euribor rose from 3.179% in April to 3.372% in May, an increase of 0.193 percentage points.

Euribor began to rise more significantly from February 4, 2022, after the European Central Bank (ECB) admitted it might raise key interest rates due to rising inflation in the eurozone, and the trend was reinforced with the start of Russia’s invasion of Ukraine on February 24, 2022.

At the latest monetary policy meeting, held on June 15, the ECB raised its key interest rates for the eighth consecutive meeting, but, as on May 4, by just 25 basis points, less than the 50 basis points raised on March 16, February 2 and December 15, when it began to slow the pace of increases compared with the previous two, which were 75 basis points, on October 27 and September 8, respectively.

On July 21, 2022, the ECB raised all three key interest rates by 50 basis points for the first time in 11 years.

The three-, six- and twelve-month Euribor rates reached historic lows of -0.605% on December 14, 2021, -0.554% and -0.518% on December 20, 2021 respectively.

Euribor is set according to the rates at which a group of 57 banks in the eurozone are willing to charge each other on the interbank market.

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