Record low interest rates here to stay, predict economists

Record low interest rates here to stay, predict economists

Record low interest rates are here stay, according to leading analysts.

Some of the country’s top economists yesterday predicted that the ECB may only start hiking rates as late as 2019, something which will be welcome news to all those with a tracker mortgage.

It will also keep the pressure on banks to lower their standard variable rates.

“This is good news for Irish businesses and Irish households,” said Philip O’Sullivan, chief economist at Investec Ireland, who predicted no increase until at least 2019.

The timing of any rate rise will have a lot to do with the outlook of crude oil prices, but the ECB would not likely start hiking rates before 2018, said Alan McQuaid, chief economist at Merrion Capital.

“My personal view is that the ECB won’t countenance a rate rise for at least two years,” said David McNamara, economist at Davy.

The current ECB interest rate is at a record low of 0.05%, down from an all-time high of 4.75% in October 2000 and from above 4% in late 2008.

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