Irish deposit rates barely a tenth of euro area average
Central Bank figures highlights ongoing disparity between rates here and elsewhere
Deposit rates offered by Irish banks are barely a tenth of the euro-area average, according to new Central Bank figures.
They show interest rates on new household term deposits in the Republic were unchanged in January, at 0.04 per cent.
Equivalent euro-area rates rose by 3 basis point over the month, to 0.38 per cent, however.
The so-called “wedge” between rates here and elsewhere arose after the crash, but have persisted.
The banks maintain that the lower rates reflected the elevated risk of operating in the Irish market.
An even bigger flashpoint has been the disparity between mortgage interest rates charged here and elsewhere in Europe.
The latest figures show the average rate charged on new mortgages in the Republic was just over 3 per cent, compared to a euro-area average of 1.78 per cent.
They also show that fixed-rate mortgages accounted for 70 per cent of new home loans over the three months to January, a new series high.
This compared with 81 per cent of new agreements over the same time in the euro zone.
The number of buyers opting for fixed rates here has jumped sharply in recent years. Back in 2014, fixed-rate products accounted for just 10 per cent of Irish home loans.
The value of new mortgage agreements amounted to €556 million in January 2019, an increase of 9 per cent on the same month in 2018. Renegotiated mortgages amounted to €232 million in January.