The consensus of analysts points to the fact that the 12 month Euribor, which is the main indicator for setting the interest rate on variable-rate mortgages, will be slightly above 3% in 2023, not very far, in any case, from the average of 2.8% already shown by the first 15 days of November. The Forecast Panel that prepares the Savings Banks Foundation (Funcas) from 19 analysis services has revised upwards this Wednesday its projections on the evolution of interest rates, after the last two increases in the official price of money undertaken by the European Central Bank (ECB), which They have placed it at 2%.
The panelists are now betting that the official price of money It will continue to rise to 3%, a level at which it would stabilize from the second quarter of 2023. The ECB deposit facility, for its part, would be close to 2.5% at the end of the forecast period, one point more than in the previous consensus, from September.
For the 12-month Euribor, it is expected that after the 2022 ‘rally’, this indicator could stand at an average of 3.1% in the central months of next year, with a slightly downward trend in its final stretch. After the intense rise in 2022, of more than 3 points, which, at least for now, has driven the 12-year Euribor from a negative rate of -0.477 in January to an average of 2.8% in mid-November, the mortgage indicator would tend to stabilize around 3.1% throughout 2023.
In the chapter on interest rates, the Panel of forecasts for the Spanish economy for November also corrects upwards the performance of the 10 year bond, which would be close to 3.5% throughout 2023, almost half a point more than in the September Panel. At the moment, the yield on the 10-year Spanish bond exceeds 3.1%, 30 basis points more than in September. “The risk premium has stabilized at moderate levels close to 105 points, a level that shows the absence of financial tensions in the public debt market, at least for the moment,” says the latest Funcas Panel.
Growth, inflation and deficit
Regarding macroeconomic forecasts, the Funcas Panel expects the Spanish economy to grow by 4.5% this year, three tenths more than estimated in September, when the revision of National Accounts figures for the second trimester. Also in the third quarter, GDP grew more than expected, 0.2%. For the fourth, most of the panelists foresee negative growth. For 2023, the consensus has lowered the GDP growth forecast from 1.9% to 1.1%, with zero growth in the first quarter and increases of around 0.5%-0.7% in the rest.
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The estimate for inflation The annual average in 2022 is revised upwards by one tenth to 8.7%, while the core remains at 5%. For 2023, the forecast for the average general rate rises three tenths, to 4.1%, and that of the underlying two tenths, to 4%. The interannual rates of the general index expected for December 2022 and 2023 are 7.1% and 2.8%, respectively.
The public deficit will remain at high levels. Specifically, the negative balance of public accounts would be 4.8% of GDP this year and 4.5% next year, according to the consensus of the 19 analysts that make up the Funcas Panel.