Taxas de juro sem descer: Como evitar o impacto?

Interest rates without falling: How to avoid the impact?

Interest rates are expected to remain at the high levels they are now until inflation drops to the desired target of 2% - says Jerome Powell, chairman of the Federal Reserve. Find out what to do to avoid the impact.

14 Nov 20233 min

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Looking to save on your home loan? There are solutions that can help you... Contact the credit intermediaries from Poupança no Minuto and find out. Or first understand what is expected for interest rates.

Fed president rules out scenario of interest rate cuts until inflation reaches the 2% target.

According to news released by Notícias ao Minuto, the president of the Federal Reserve (Fed), Jerome Powell, explains that interest rates will not drop until a sustained decrease in inflation is observed down to the 2% target.

In this sense, the president reveals that the monetary policy stance to be adopted by the Fed will be "sufficiently restrictive to sustainably reduce inflation to 2%, until it is noted that inflation is on track to achieve this goal."

Powell's statements followed the meeting of the monetary policy committee, where it was decided that the interest rate hike would pause and rates would remain unchanged for the second consecutive time. "Rates will remain in the range of 5.25% to 5.5%, the highest level since 2011," the news reads.

About the future, the President of the Fed does not rule out the possibility of a new rise in interest rates at the December meeting, but guarantees that no decision has been made yet: "We didn't even talk today about making a decision in December".

Regarding a possible interest rate cut, this is a scenario that, according to Powell, has not yet been presented and for now, it will not be a possibility to consider, but rather "an issue to be addressed in the future," concludes.

How to avoid the impact of interest rates on my mortgage credit?

In order to avoid the impact of interest rates on your mortgage, it is necessary to change the interest rate regime that you have contracted for the loan.

By having a variable rate indexed to Euribor, you will always suffer its fluctuations: Whenever it increases in different terms, your monthly installment will follow suit. Therefore, as long as it is not predictable that interest rates will fall, the current value of your installment will either remain the same or increase.  

But if you change the interest rate to a fixed or mixed rate, your payment is no longer associated with an index. With the same fixed rate, you can always count on the same amount, providing greater stability and security in your credit.  

To do this, you can ask your bank to renegotiate conditions and request the change. However, what often happens is that banks do not approve the change of interest rate regime. Therefore, what many Portuguese people do is transfer their housing credit to another bank that allows access to different rate campaigns.

For example, right now, it is possible to have access to mixed rates starting from 3.00%, where there is a fixed rate for two years, then returning to variable.

If you want to explore this hypothesis, contact a credit intermediary who can help you simulate your specific case! The agents of Poupança no Minuto provide this service for free, and accompany you throughout the process if you decide to proceed with the credit transfer. Contact us and understand how we can help you save on your mortgage credit! 

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