Interest rate – Bobs Birdhouse http://bobsbirdhouse.com/ Tue, 22 Nov 2022 04:41:45 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://bobsbirdhouse.com/wp-content/uploads/2021/06/cropped-icon-32x32.png Interest rate – Bobs Birdhouse http://bobsbirdhouse.com/ 32 32 Dutch banks raise interest rates https://bobsbirdhouse.com/dutch-banks-raise-interest-rates/ Tue, 22 Nov 2022 04:06:22 +0000 https://bobsbirdhouse.com/dutch-banks-raise-interest-rates/ After years of Dutch banks offering little to no interest on savings accounts, the past two months have seen a number of major banks announce interest rate hikes for customers. Here’s everything we know so far. Why are Dutch banks suddenly raising their interest rates? Interest rate in the Netherlands have been set at 0% […]]]>

After years of Dutch banks offering little to no interest on savings accounts, the past two months have seen a number of major banks announce interest rate hikes for customers. Here’s everything we know so far.

Why are Dutch banks suddenly raising their interest rates?

Interest rate in the Netherlands have been set at 0% for several years now, but after the European Central Bank (ECB) announced higher interest rates earlier this year, Dutch banks were encouraged to make a change, finally announcing lower interest rates. above 0% interest for savings accounts.

Since November 2, in an attempt to combat the high rates of inflation seen across Europe – the Netherlands recently recorded an inflation rate of 14.3% – the ECB raised its interest rate on the main refinancing operations, the interest rates on the marginal lending facility and the deposit facility by 0.75 percentage point, to 2, 2.25 and 1 .5% respectively.

Which banks in the Netherlands offer interest on savings?

So far, a number of major banks in the Netherlands have announced changes to their interest rates. These include:

  • ABN AMRO
  • Rabobank
  • ING
  • SRS
  • ASN Bank
  • RegioBank

The rules vary depending on your bank, but the new rates will come into effect in December 2022.

What are my bank’s new interest rates?

Wondering if these new rates will apply to your bank account or not? This is what we know so far about rising interest rates.

Interest rates at Rabobank, ABN AMRO and ING

Rabobank was the first to announce that it would raise interest rates before the end of the year. From December 1, a variable interest rate of 0.25% will apply to all savings and investment accounts, significantly higher than the rate of 0.01 that the bank currently offers for accounts up to at 100,000 euros. If you have a so-called RegenboogRekening – an account that parents can create for their child – the rate will increase to 0.35 per cent.

ABN AMRO and ING were quick to follow in Rabobank’s footsteps, raising their interest rates from 0% to 0.25%. At ABN AMRO, interest will be available for accounts up to €1 million, while at ING it will only apply to accounts up to €10,000. Beyond this amount, the interest rate will be set at 0.15% for accounts between 10,000 and 1 million euros, and at 0% for accounts over 1 million euros.

Interest rates at SNS, ASN and RegioBank

Last I heard, three other smaller Dutch banks – SNS, ASN Bank and RegioBank – are also confirming positive interest rates for customers. From next month, RegioBank and SNS will both offer their customers interest rates of 0.25% for accounts up to 25,000 euros. At ASN Bank, an interest rate of 0.2% will apply to accounts with an amount less than or equal to this.

Larger savings accounts will benefit from slightly lower interest rates (0.15% for accounts between 25,000 and 50,000 euros and 0% for accounts above 50,000 euros). All three banks currently have interest rates of 0 or 0.1%.

International banks always offer the highest interest rates

While Dutch banks have not only abolished their negative interest rates, but are finally offering their customers positive interest rates on savings accounts, RTL News reports that international bank interest rates are even higher – although at this stage the differences are minimal.

“You will certainly not become rich, with a maximum of 85 euros per year [available] for 10,000 euros in savings,” writes the Dutch news site. Of all the Dutch banks, LeasePlan Bank seems to offer the highest rates (0.5%).

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What is a High Yield Savings Account? https://bobsbirdhouse.com/what-is-a-high-yield-savings-account/ Sat, 19 Nov 2022 18:16:00 +0000 https://bobsbirdhouse.com/what-is-a-high-yield-savings-account/ High yield savings accounts are similar to standard accounts savings accounts but pay higher interest rates. They are perfect for maintaining an emergency fund or meeting short-term savings goals. If you’re considering opening a high-yield savings account, understanding how it works and what to look for is essential so you can save your money with […]]]>

High yield savings accounts are similar to standard accounts savings accounts but pay higher interest rates. They are perfect for maintaining an emergency fund or meeting short-term savings goals. If you’re considering opening a high-yield savings account, understanding how it works and what to look for is essential so you can save your money with achievable goals in mind.

What is a High Yield Savings Account?

A High Yield Savings Account is a deposit account that offers a higher interest rate than a traditional savings account, allowing you to earn more on your savings. Some banks may charge monthly maintenance fees or limit the number of withdrawals you can make, but online banks usually offer high-yield accounts with no fees.

The interest rate associated with a high yield savings account is denoted APY, or annual percentage yield. The higher the APY, the faster your money grows. But keep in mind that this is a variable rate and will fluctuate as the Federal Reserve updates its benchmark interest rate. However, with a High Yield Savings Account, you will always earn the highest interest rate on your money. most of today best high yield savings accounts have APYs of at least 2.15%, which is ten times higher than the national savings account average by 0.21%.

How do high yield savings accounts work?

When you put your money in a savings account, you want a competitive return to maximize growth. APY is applied to your High Yield Savings Account balance as compound interest. Compound interest means you will earn interest on your principal balance and the interest it earns, in other words, interest on interest. Your interest will be compounded daily or monthly depending on the terms of your account. The higher the interest rate and the more frequently your interest is compounded, the more money you will earn over time.

A pandemic-era federal law known as the Regulation D now makes it easier for you to access your savings deposits without penalty, as it has eliminated a limit of six monthly withdrawals without penalty. However, your bank may still charge penalties for other types of transfers.

To open a high-yield savings account, you must provide your social security number and contact information, as well as at least one form of identification, such as a driver’s license or passport. For a joint account, anyone wishing to access it must provide this information and this identifier.

The best online banks tend to offer the most competitive returns. Many online banks don’t charge monthly service fees, and some also don’t have minimum balances or opening deposit requirements.

Benefits of a High Yield Savings Account

  • Higher APYs: The interest rate on a high-yield savings account is generally higher than that of a traditional savings account.
  • Security: Money held in an FDIC-insured bank is protected up to $250,000 per depositor, per type of account ownership, per financial institution. FDIC insurance protects your money in the event of bank failure.
  • No monthly fees: Many high-yield savings accounts don’t charge a monthly fee, although some do. Be sure to check the terms and fees of your High Yield Savings Account before opening it to avoid confusion. Keep in mind that some accounts waive monthly fees if you reach a minimum balance.
  • Accessibility: You can access your funds in a high-yield savings account; however, your bank may charge a fee under certain circumstances.
  • Compound interest: Many high-yield savings accounts earn interest daily.

Disadvantages of a High Yield Savings Account

  • Variable interest rate: The interest rate on a High Yield Savings Account is variable, meaning it can change at any time.
  • Higher minimum deposit requirements: Some high yield savings accounts have higher minimum deposit requirements than your regular savings account.
  • Zero risk but limited return: Although many high yield savings accounts offer a variable APY, they are still lower than other financial tools, such as money market accounts.

What should you look for in a high yield savings account?

When choosing a high-yield savings account, consider the following:

APY

You will want the highest possible APY with a high yield savings account. As rates can change at any time, it is good to keep up to date with current rates.

Minimum balance requirements

Some banks set a minimum balance required to earn the stated APY, while others offer the same APY on all balances. Write down any minimum balance requirements to avoid any surprises.

Costs

Monthly maintenance fees and minimum balance fees can eat into your savings. If you’re considering a fee-based account, consider the overall cost and corresponding deadlines to avoid unpleasant surprises.

Alternatives to High Yield Savings Accounts

Several other types of accounts can help you grow your money, including:

  • Money market accounts are similar to savings accounts and checking accounts because you earn interest like a savings account. Nevertheless, you can make purchases linked to a debit card like a checking account.
  • A certificate of deposit, or CD, is a savings account that pays a fixed rate of interest for a fixed term. However, you can only withdraw your money from a CD once it has been in the account for a certain amount of time, called a term.
  • Investment accounts can help you grow your money over time, but they come with more risk. It is important to remember that the money in your savings account is federally insured up to $250,000, while non-deposit investment products are not insured.

The bottom line

Whether you’re looking to build an emergency fund or simply put some money aside, you can invest with peace of mind knowing that high-yield savings offer competitive returns with minimal risk.

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Industrial sales are not immune to the impact of rising interest rates https://bobsbirdhouse.com/industrial-sales-are-not-immune-to-the-impact-of-rising-interest-rates/ Wed, 16 Nov 2022 19:35:58 +0000 https://bobsbirdhouse.com/industrial-sales-are-not-immune-to-the-impact-of-rising-interest-rates/ Throughout the pandemic, industrial properties were among the most sought after by commercial real estate investors. But in the current market environment, are industrial assets holding up as well? In fact, demand for industrial properties is down significantly from the first quarter of this year, says Chris Riley, president of U.S. industrial and logistics capital […]]]>

Throughout the pandemic, industrial properties were among the most sought after by commercial real estate investors. But in the current market environment, are industrial assets holding up as well?

In fact, demand for industrial properties is down significantly from the first quarter of this year, says Chris Riley, president of U.S. industrial and logistics capital markets at real estate services firm CBRE. “While the market for investment sales is uneven, there remains a small contingent of investors who possess a ‘momentary motivation’ to acquire properties,” he adds, noting that CBRE National Partners has completed 18 transactions. in October, proof that the market is still active.

Following a further rise in interest rates and continued economic uncertainty, the overall volume of industrial transactions in the United States fell 18% year-on-year in the third quarter, reports data provider MSCI Real Assets. But at $35.5 billion, this volume was still 48% higher than the quarterly average recorded between the third quarter of 2015 and 2019which totaled approximately $23.9 billion.

Acquisition activity in the industrials sector began to tighten along with the upward pressure on interest rates this summer and continued through the fall. Sales of single assets were down 21% year-over-year in the third quarter, while sales at the portfolio and entity level were down 14%, according to MSCI.

But rising interest rates weren’t the only thing that caused investors to pause before acquiring new assets. Ultra-low cap rates in the industrials sector – averaging 5.1% in the third quarter, according to MSCI – added to the challenges. A year ago, the spread of cap rates on industrial assets versus 10-year Treasury bills averaged 230 basis points. This figure fell to 20 basis points in the third quarter of 2022. As a result, while investors can still close deals, they face more hurdles in underwriting assets and earning the desired returns.

With higher borrowing costs, investor demand has cooled, notes Aaron Jodka, national director of capital markets research at real estate services firm Colliers. “The 2021 and early 2022 ultra-low cap rate deals are no longer economically feasible, as they would be in a negative leverage situation,” he says. “It stagnated the market.”

Due to quantitative tightening and the ensuing credit crunch, a number of transactions involving industrial assets saw a revaluation and/or were completely scrapped, according to CBRE’s Riley. “This was centered on when the Federal Reserve raised the federal funds rate and the resulting increase in the cost of debt capital (fixed or variable) causing a temporary gap between the capitalization rate at the cash and the capitalization rate.”

Lease terms and location of assets lead to price differences, Jodka notes. In general, prices have fallen by at least 10%, he says. Assets with sharply rising market-to-market rents remain the most liquid. The Commercial Property Price Index (CPPI) tracked by MSCI shows industrial property prices rose another 1.9% in the third quarter compared to the previous quarter. But there has certainly been a slowdown from the 18.1% year-over-year increase.

There’s a bigger gap between sellers’ expectations and buyers’ reality than usual right now, which is keeping cap rates so low, according to Adrian Ponsen, director of US industry analysis at the firm. CoStar Group real estate data.

“Buyers are looking at industrial mortgage rates that are twice what was available at the end of 2021,” Poston says, adding that investors want higher cap rates to help offset the higher cost of capital. . “But most landlords hold properties that are doing very well in terms of occupancy and rent growth, giving them limited incentive to sell. Ultimately, buyers have sold off the most in recent months, although that could change if trends in the economy deteriorate.

CoStar estimates third-quarter industrial sales totaled about $46 billion, down significantly from a peak of nearly $96 billion in the fourth quarter of 2021, but nearly in line with the volume seen in the fourth quarter of 2020.

Although there are significantly more constraints in the debt market than before, funding is still available for quality industrial assets, although market depth is quite low and rates have risen significantly, adds Val Achtemeier, Vice President of Capital Markets at CBRE. . He notes that industrial and multi-family assets fare better in terms of access to finance than most other property typesbut says “debt capital is more valuable and lenders are more selective now.”

Investors also have fewer industrial properties to choose from, especially in the most desirable markets. “The number of properties offered for sale in the fourth quarter is lower than a year ago, while the market was experiencing optimal operating fundamentalscombined with a wall of equity and debt capital for investment,” says Riley.

The lower number of assets available in the market “is related to higher borrowing costs and the lack of clarity on prices today,” according to Jodka. He remains optimistic that interest rates will stabilize in 2023, leading to a recovery in sales volume, likely after the first quarter of the year.

Meanwhile, with the completion of new distribution center projects reaching new heights, many developers continue to sell these projects to investors, Ponsen says. And many large landlords/users are selling their properties to industrial investors under sale-leaseback agreements and realizing significant capital gains in the process.

The good news is that closed industry deal cap rates are no longer falling as they were in 2021, but have remained relatively stable in 2022, he notes.

“This is remarkable, given the dramatic rise in interest rates over the year, and ultimately speaks to the fact that there are still many more investors looking to grow their exposure to the industrial sector that there are investors looking to reduce their exposure.” their industrial operations.

As interest rates on commercial mortgages rise, “we expect some increase in industrial cap rates over the next few months,” Posen adds. But these increases are expected to be modest, given that the industrial sector still offers the most optimistic outlook for net operating income growth for all major commercial property types.

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Main factors aligned to drive up farmland prices https://bobsbirdhouse.com/main-factors-aligned-to-drive-up-farmland-prices/ Mon, 14 Nov 2022 08:10:48 +0000 https://bobsbirdhouse.com/main-factors-aligned-to-drive-up-farmland-prices/ Using the Survey of Farmland Values ​​and Cash Rents released by Purdue University each August, the average price per acre of average productivity land in Indiana has increased by about 30% from June 2021 to June 2022. The long-term average annual increase in farmland values ​​since 1973 is closer to 5.5%. What explains the recent […]]]>

Using the Survey of Farmland Values ​​and Cash Rents released by Purdue University each August, the average price per acre of average productivity land in Indiana has increased by about 30% from June 2021 to June 2022. The long-term average annual increase in farmland values ​​since 1973 is closer to 5.5%. What explains the recent strength in farmland values?

The main variables affecting farmland prices include the cash rent or net return to land; working capital; interest rate; inflation; investment potential of farmland relative to other investments such as the stock market, corporate bonds or similar assets; and the provision of land.

Related: Where will land prices go in 2023?

Let’s first look at cash rent or net return on land and working capital. Next, we’ll look at interest rates, inflation, farmland investment potential, and land supply. Both sets of factors have contributed positively to recent strength in farmland values.

Cash rent, working capital

Cash rents are mainly driven by net land returns. Using a case farm in west-central Indiana, the actual net return from the land has averaged about $260 per acre per year since 2007. During this time, the annual cash rent in central -western Indiana for medium productivity soil averaged $240 per acre. Thus, the average net return to land was greater than the average cash rent.

In addition, the net return to land has recently been significantly higher than cash rent. In 2020 the cash rent was $252 and the net land return was $331 per acre, while in 2021 the cash rent was $262 and the net land return was $510 per acre . Net land return and cash rent projections for 2022 are $289 and $400 per acre, respectively.

The relatively high net return to land in recent years has also bolstered working capital, an important source of funds when making installments on farmland.

Interest rate

Long-term capitalization rates are an important factor influencing the value of farmland. The capitalization rate depends on the long-term rate of US Treasury bills, called the risk-free interest rate, inflation and the risk premium between the long-term interest rate on land and the long-term rate. US Treasury bond term. If any of these factors increase or decrease, the capitalization rate on farmland is likely to increase or decrease.

The value of agricultural land is inversely proportional to the capitalization rate. Thus, a higher capitalization rate leads to a decrease in the value of agricultural land.

What affects the cap rate? Inflation has been relatively high over the past two years. In addition to putting upward pressure on interest rates, note that farmland is seen as a good hedge against inflation.

When these two opposing forces are combined, we generally see a positive relationship between farmland values ​​and inflation. Until recently, the risk premium and interest rates were relatively low, which contributed to the increase in the value of agricultural land.

Meanwhile, the farmland market is often considered to be very thin, meaning that the supply of farmland in the market is a very small percentage of the state’s total farmland. The tightness of the land market often translates into strong demand when land becomes available locally.

Finally, due to its low correlation with stock market returns, agricultural land is also attractive to institutional investors. Thus, this second group of factors has also contributed to the recent strength in farmland values.

Langemeier is an economist at Purdue Extension and associate director of the Purdue Center for Commercial Agriculture.

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WisdomTree Interest Rate Hedged US Aggregate Bond Fund (NASDAQ:AGZD) Short Interest Down 69.0% in October https://bobsbirdhouse.com/wisdomtree-interest-rate-hedged-us-aggregate-bond-fund-nasdaqagzd-short-interest-down-69-0-in-october/ Fri, 11 Nov 2022 08:17:57 +0000 https://bobsbirdhouse.com/wisdomtree-interest-rate-hedged-us-aggregate-bond-fund-nasdaqagzd-short-interest-down-69-0-in-october/ WisdomTree Interest Rate Hedged US Aggregate Bond Fund (NASDAQ:AGZD – Get a rating) benefited from a significant drop in short-term interest rates in October. As of October 31, there was short interest totaling 11,000 shares, down 69.0% from the total of 35,500 shares as of October 15. Based on an average daily volume of 66,800 […]]]>

WisdomTree Interest Rate Hedged US Aggregate Bond Fund (NASDAQ:AGZDGet a rating) benefited from a significant drop in short-term interest rates in October. As of October 31, there was short interest totaling 11,000 shares, down 69.0% from the total of 35,500 shares as of October 15. Based on an average daily volume of 66,800 shares, the day-to-cover ratio is currently 0.2 days.

Price Performance of WisdomTree Interest Rate Hedged U.S. Global Bond Fund

AGZD Stock opened at $45.68 on Friday. The company has a 50-day simple moving average of $45.65 and a 200-day simple moving average of $45.82. WisdomTree Interest Rate Hedged US Aggregate Bond Fund has a 12-month low of $45.18 and a 12-month high of $47.14.

WisdomTree Interest Rate Hedged US Aggregate Bond Fund Announces Dividend

The company also recently declared a monthly dividend, which was paid on Friday, October 28. Investors of record on Wednesday, October 26 received a dividend of $0.11 per share. This represents a dividend of $1.32 on an annualized basis and a yield of 2.89%. The ex-dividend date was Tuesday, October 25.

Institutional entries and exits

Several hedge funds and other institutional investors have recently bought and sold shares of AGZD. Rain Capital Management LLC bought a new position in WisdomTree Interest Rate Hedged US Aggregate Bond Fund during Q2 for a value of $100,000. Flow Traders US LLC bought a new position in WisdomTree Interest Rate Hedged US Aggregate Bond Fund during Q2 for a value of $230,000. Integrated Wealth Concepts LLC acquired a new position in WisdomTree Interest Rate Hedged US Aggregate Bond Fund during Q2 for a value of $321,000. NEIRG Wealth Management LLC increased its position in WisdomTree Interest Rate Hedged US Aggregate Bond Fund by 31.0% during the second quarter. NEIRG Wealth Management LLC now owns 10,644 shares of the company worth $485,000 after purchasing an additional 2,516 shares in the last quarter. Finally, Jackson Creek Investment Advisors LLC bought a new position in WisdomTree Interest Rate Hedged US Aggregate Bond Fund during Q1 for a value of $580,000.

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Santander improves the interest rate on 123 flagship current accounts https://bobsbirdhouse.com/santander-improves-the-interest-rate-on-123-flagship-current-accounts/ Tue, 08 Nov 2022 12:11:44 +0000 https://bobsbirdhouse.com/santander-improves-the-interest-rate-on-123-flagship-current-accounts/ Santander UK has increased the rate of its 123 flagship accounts as competition between providers intensifies. The annual credit interest rate on current 123, Select and Private accounts has been increased from 1.50% to 1.75% on balances up to £20,000. The new interest rate will apply automatically from Tuesday, meaning customers can now earn up […]]]>

Santander UK has increased the rate of its 123 flagship accounts as competition between providers intensifies.

The annual credit interest rate on current 123, Select and Private accounts has been increased from 1.50% to 1.75% on balances up to £20,000.

The new interest rate will apply automatically from Tuesday, meaning customers can now earn up to £347.22 in interest a year, on top of any cashback they earn on certain household bills paid by direct debit.

The previous rate was 1.50% and it has already been increased several times this year. It had already been reduced several times, during years of low interest rates.

Cashback on household bills through the 123 accounts is capped at £5 in each of three different cashback tiers.

Customers can earn 1% cashback on municipal tax bills, mobile and home phone bills, broadband and pay TV packages, and monthly Santander mortgage payments.

They can receive 2% cash back on gas and electricity bills, Santander home insurance premiums and Santander life insurance premiums.

They can also receive 3% cashback on water bills.

There is a £4 monthly charge for accounts and Santander said this will remain unchanged.

Santander said the interest rate on its 123, Select and Private checking accounts is variable and does not follow the Bank of England’s base rate.

The Bank of England raised the base rate to 3% last week, marking the latest in a series of increases. Many savings providers have improved their rates in recent months and some current account providers have also increased their money-for-change offers.

Many providers offer offers on their current accounts to attract new customers (PA)

On Monday, HSBC UK launched a current account switching offer of £200. The Nationwide Building Society is also offering £200 for change.

Rachel Springall, finance expert at Moneyfacts.co.uk, said: “As interest rates continue to rise, it’s good to see providers improving their current account offerings to attract new business.

“A credit interest paying current account can be a convenient way for consumers to earn interest on their credit balance and Santander’s offer has a high threshold of £20,000 unlike some of its peers.

“Apart from checking accounts, customers can earn even more interest using an easy access account, for an account with unlimited withdrawals with just a £1 deposit, they can earn 2.52% gross with Tandem Bank, which has a maximum investment of £250,000.

“Consumers looking for current accounts with benefits may find Santander’s cashback offer appealing, particularly in a cost of living crisis where every penny counts, but it’s capped at £5 a month for each category.”

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How to Cut Hundreds of Dollars From Your Interest Rate https://bobsbirdhouse.com/how-to-cut-hundreds-of-dollars-from-your-interest-rate/ Sat, 05 Nov 2022 22:57:11 +0000 https://bobsbirdhouse.com/how-to-cut-hundreds-of-dollars-from-your-interest-rate/ Every time the Reserve Bank of Australia has raised interest rates in recent months, Jessica’s bank has passed on the hike. She adjusted her budget each month and tried to reduce her expenses so that she could continue to save money. “I wanted to keep a savings reserve, but that reserve was shrinking every month […]]]>

Every time the Reserve Bank of Australia has raised interest rates in recent months, Jessica’s bank has passed on the hike.

She adjusted her budget each month and tried to reduce her expenses so that she could continue to save money.

“I wanted to keep a savings reserve, but that reserve was shrinking every month with every rise in interest rates,” she told NCA NewsWire.

Eventually, Jessica realized she had to do something else.

After a friend mentioned her interest rate at another bank was lower, Jessica called her lender and asked for a better deal.

“It was as simple as that – I spoke to someone on the phone and they took 0.5% off my interest rate. I was so happy,” she said.

Finspo co-founder and chief executive Angus Gilfillan told NCA NewsWire that simply asking your bank for a better deal could be a quick and easy option to improve your current rate.

“However, you may miss out on more competitive options in the market if you stop there,” he said.

“You can also go the do-it-yourself route of finding the best deal, but comparing all the repayment offers, rates, switching costs, features and benefits of the thousands of loan options available can be quite tricky.

“So one of the best ways to compare apples to apples is to speak with a mortgage broker.”

Even if your bank offers a better deal, Gilfillan said it might still be worth refinancing to maximize your savings.

“A lot of people put refinancing in the ‘too hard’ basket, given how stressful it was to get their home loan in the first place,” he said.

“But without the emotional roller coaster of buying a property, the process of getting a new home loan, aka refinancing, can be a lot less overwhelming and well worth it.

“In fact, avoiding the mortgage fidelity tax by refinancing regularly can have a huge impact on your savings.”

For a $500,000 mortgage, Gilfillan said the additional interest savings equaled $91,000 on a 30-year home loan.

Gilfillan also recommended people with a clearing account to make the most of it.

“Be sure to use your clearing account as much as possible, as the benefit may be higher than having balances in the transaction account or savings account interest rates,” he said. -he declares.

He suggested people make a lump sum payment if possible.

“Every dollar counts towards reducing your loan principal, which significantly reduces the interest you’ll pay over the life of your home loan, especially when rates rise,” Gilfillan said.

“Just check with your lender if any fees apply to make additional repayments.”

Changing your refunds could also help, he added.

“By simply switching from monthly to semi-monthly payments, you will be contributing the equivalent of one additional monthly repayment per year, which may not be too noticeable to you, but can make a huge difference in the interest you pay during the life of the loan,” he said.

The RBA this month raised the cash rate target by 25 basis points to 2.85%.

Further increases are expected in the coming months as the country battles high inflation.

In the year to September, the CPI inflation rate was 7.3%, the highest in more than three decades.

Inflation is expected to peak at around 8% later this year.

“The board expects to raise interest rates further over the coming period,” RBA Governor Philip Lowe said this week.

“He closely monitors the global economy, household spending and wage and price setting behavior.

“The magnitude and timing of future interest rate increases will continue to be determined by incoming data and the board’s assessment of the outlook for inflation and the labor market.

“The board remains steadfast in its determination to bring inflation back to target and will do what is necessary to achieve this.”

BASE VARIABLE INTEREST RATES OFFERED BY THE BIG FOUR BANKS:

  • ABC — 4.44%;
  • NAB — 4.49%;
  • ANZ — 4.44%; and
  • Westpac — 4.24%.

* Each bank has different terms in their respective packages. Small lenders also offer comparable rates.

Read related topics:reserve bank
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US Fed set for fourth interest rate hike https://bobsbirdhouse.com/us-fed-set-for-fourth-interest-rate-hike/ Mon, 31 Oct 2022 12:05:00 +0000 https://bobsbirdhouse.com/us-fed-set-for-fourth-interest-rate-hike/ WASHINGTON, United States — The U.S. Federal Reserve is set to make a fourth consecutive key interest rate hike this week as it battles soaring costs, with its aggressive stance fueling expectations of a recession. US households have been squeezed by soaring consumer prices, pushing economic issues to the forefront of voters’ concerns in the […]]]>

WASHINGTON, United States — The U.S. Federal Reserve is set to make a fourth consecutive key interest rate hike this week as it battles soaring costs, with its aggressive stance fueling expectations of a recession.

US households have been squeezed by soaring consumer prices, pushing economic issues to the forefront of voters’ concerns in the upcoming midterm elections. Fed officials are walking a tightrope in an attempt to rein in prices while avoiding a downturn.

To raise borrowing costs and calm demand, the US central bank has already raised the benchmark policy rate five times this year, including three consecutive increases of 0.75 percentage points.

But with inflation still high and a tight labor market supporting wages and spending, analysts say another 0.75 point hike is all but certain at the next policy meeting of central bankers.

The policy-setting Federal Open Market Committee begins its two-day policy meeting on Tuesday, and all eyes are on signals that it may be ready to wind down its campaign in the coming months.

The focus will be on whether the committee is confident it is “on track” towards a policy that is tight enough to manage inflation risks, according to Barclays analysis.

Many economists expect the Fed to raise rates another half point again in December.

Federal Reserve Chairman Jerome Powell has made it clear there is no ‘painless way’ to cool the economy and avoid a repeat of the last time US inflation spiraled out of control in the 1970s and early 1980s.

It took aggressive policy action and a recession to bring prices down, and the Fed is unwilling to give up its hard-won inflation-fighting credibility.

“We’ve been told time and time again that the Fed will continue to raise rates aggressively until it sees ‘convincing’ evidence that inflation is slowing,” said Nancy Vanden Houten, US economist at Oxford Economics. .

“I don’t think the data meets that standard so far,” she told AFP.

The Fed’s actions have trickled down to the economy, with mortgage rates recently hitting their highest level in decades and home sales falling.

Further Fed hikes should also dampen consumer and business spending, making them more attractive to save than spend.

Analysts warn that the economy could slip into recession in 2023 as Fed rate hikes, inflation and a global slowdown in growth hit.

Political divide

Some Fed officials have expressed concern about excessive policy tightening, wanting to consider a slower pace of rate hikes or even a pause to assess the impact of current moves, Vanden Houten said.

In October, San Francisco Fed President Mary Daly told an event that policymakers should start planning for a reduction in the magnitude of rate hikes, even if it is not yet time. to step back, while Chicago Fed President Charles Evans separately noted that “overshoot is expensive.”

He added that there is uncertainty as to how the restrictive policy should become.

While St. Louis Fed President James Bullard, who has argued for an acceleration in policy hikes, has hinted at a possible pause next year, others reiterated their intention to keep raising rates until there are signs that inflation is contained.

“This divide reflects the positioning for a debate over the direction of policy in the months ahead,” Barclays analysts said.

The central bank’s benchmark rate is currently within a target range of 3% to 3.25%.

Even with lower gasoline prices, consumer prices aren’t letting up – with a core measure that wipes out the volatile food and energy segments hitting a 40-year high in September.

Policymakers are not just concerned about high inflation, but that a mindset of continuously rising prices will set in, leading to a dangerous spiral and a phenomenon called stagflation.

This fear prompted the Fed to accelerate its rate hikes rather than follow the more usual course of small, gradual steps over a longer period.

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European markets open at close, results, data and news https://bobsbirdhouse.com/european-markets-open-at-close-results-data-and-news/ Fri, 28 Oct 2022 11:42:00 +0000 https://bobsbirdhouse.com/european-markets-open-at-close-results-data-and-news/ Russia keeps interest rates unchanged, ending months of cuts MOSCOW, Russia: Russia’s central bank cut its key rate by 300 basis points for the third time since its emergency hike in late February, citing cooling inflation and a rallying ruble. KIRILL Kudryavtsev | AFP | Getty Images Russia’s central bank kept its interest rate unchanged […]]]>

Russia keeps interest rates unchanged, ending months of cuts

MOSCOW, Russia: Russia’s central bank cut its key rate by 300 basis points for the third time since its emergency hike in late February, citing cooling inflation and a rallying ruble.

KIRILL Kudryavtsev | AFP | Getty Images

Russia’s central bank kept its interest rate unchanged at 7.5%, citing inflationary expectations and geopolitical uncertainty following the “partial mobilization” of Russian troops in Ukraine and the prospect of a protracted conflict.

The decision to hold the interest rate on hold ended a months-long cycle of cuts that began in April. The central bank more than doubled rates to 20% shortly after Russia invaded Ukraine to counter the ruble’s fall.

The central bank has cut rates six times since then, reaching the pre-war interest rate of 9.5% in June, citing improving fiscal conditions and falling inflation. While inflation is still well above the bank’s 4% target of 13.7% in September, it has fallen significantly from the 20-year high of 20.37% hit in April as Western sanctions and foreign exchange freezes set in.

The decision to hold rates at 7.5% was expected by a majority of analysts polled by Reuters, the news agency reported.

—Natasha Turak

Expect the unexpected with gasoline prices, says EDP CEO

According to Miguel Stilwell d’Andrade, CEO of Portuguese electricity utility company EDP, “expect the unexpected” when it comes to gas prices.

Andrade’s Stilwell made the comments on CNBC’s “Squawk Box Europe” while discussing EDP’s third quarter results and energy market turmoil.

OMV shares gain 10% as third-quarter earnings nearly double

Shares of OMV rose 10.1% on news that the Austrian oil, gas and chemicals company’s earnings were better than expected in the third quarter.

OMV posted about 96% year-on-year growth, with operating profit of 3.52 billion euros ($3.5 billion), as reported by Reuters.

Soaring oil and gas prices contributed to the increase.

—Hannah Ward-Glenton

German economy shows unexpected growth in third quarter

The German economy grew in the third quarter, contrary to expectations.

Gross domestic product rose 0.3% from the previous quarter, despite the fight against high inflation and energy problems.

A Reuters poll had forecast a contraction of 0.2%.

—Hannah Ward-Glenton

Natwest down 7% after reporting flat third-quarter results

natwest is down 7% after posting flat third-quarter results.

The British bank reported a profit of £1.1 billion ($1.3 billion), narrowly missing analysts’ forecasts.

Natwest has set aside an additional £247m to reflect the tough economic outlook in the UK, which has eaten away at profits.

—Hannah Ward-Glenton

We’re seeing ‘growth dampening’, not slowing, says Bank of America CEO

Bank of America CEO Brian Moynihan said we are seeing “growth dampening” rather than a slowdown in an exclusive interview with “Squawk Box Europe.”

Watch CNBC's full interview with Bank of America CEO Brian Moynihan

Coming soon: Bank of America CEO Brian Moynihan live on “Squawk Box Europe”

Bank of America CEO Brian Moynihan will give an exclusive live interview on CNBC’s “Squawk Box Europe” at 8am London time.

The bank released its third-quarter results on Oct. 17 and pointed to the resilience of the U.S. consumer as a reason to reduce fears of an economic recession.

You can watch the interview live on CNBC here.

—Hannah Ward-Glenton

European markets: here are the opening calls

The FTSE 100 is expected to fall 32 points to 7,039 and the German DAX 67 points to 13,155, according to data from IG. The CAC will be down 25 points to open at 6,226 and the Italian MIB will be down 89 points at 22,347.

CNBC Pro: Tech stocks are falling, but a fund manager still likes Microsoft. here’s why

Tech stocks have fallen this week as investor optimism fades following disappointing results from some of the biggest names in the industry.

But fund manager Brian Arcese is ready Microsoftcalling it a “strong long-term defensive position”.

Pro subscribers can find out more here.

— Zavier Ong

CNBC Pro: There’s a lot of pain ahead for markets, strategist warns

Investors should think twice before continuing the recent rebound in stocks, says a strategist.

“I think the market rally is a respite rally,” Beat Wittmann, president of Porta Advisors in Switzerland, told CNBC.

CNBC Pro subscribers can learn more here.

Jenni Reid

Chip stocks plummet after US official says allies may soon impose export limits on China

Bank of Japan keeps rates unchanged as expected

Japan’s central bank left interest rates unchanged Friday, in line with economists’ predictions in a Reuters poll.

The Bank of Japan also said it would buy the necessary amounts of Japanese government bonds at a fixed rate to keep the 10-year JGB yields at 0%.

“The Bank will support financing, mainly to businesses, and maintain financial market stability, and will not hesitate to take additional easing measures if necessary,” it said in its monetary policy statement.

—Jihye Lee

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Inflation and interest rate hikes weigh on Canadians https://bobsbirdhouse.com/inflation-and-interest-rate-hikes-weigh-on-canadians/ Tue, 25 Oct 2022 12:02:15 +0000 https://bobsbirdhouse.com/inflation-and-interest-rate-hikes-weigh-on-canadians/ Breadcrumb Links One in 10 Canadians expects to take on more debt to pay their mortgage Publication date : October 25, 2022 • 40 minutes ago • 5 minute read • Join the conversation With interest rates likely to rise further, Canadians surveyed were hesitant to sell, with nearly one in five expecting their home […]]]>

One in 10 Canadians expects to take on more debt to pay their mortgage

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Good morning!

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Just one more sleep until the Bank of Canada Rate Decision, and in the meantime here is the sequel knowledge on how Canadians are coping with the rising cost of borrowing.

A poll released today by Dye & Durham and online forum Angus Reid found that the three percentage points the Bank has already raised has had “a significant chilling effect on Canadian spending”, especially immovable.

One in three Canadians say that the rapid and steady rise in interest rates this year has caused them to delay a real estate transaction or a major purchase. One in 10 say they have put off buying a home, while the same proportion expects to delay buying a home next year.

Since the Bank of Canada began raising rates in March, property values ​​in Canada have gone down for seven straight months and are now down 8.8% from their peak in February.

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Smaller markets in Ontario and British Columbia that led the frothy climb during the pandemic are bearing the brunt of the correction, said RBC economist Robert Hogue. For example, prices in Cambridge, Ontario. fell by 20%, Hamilton by 16% and Chilliwack, BC by 13%.

At the same time, the sharp increase in mortgage rates has dramatically reduced the affordability of many Canadians.

One in five homeowners surveyed say they expect rising rates will mean it will take them much longer to pay off their mortgage than they thought. Nearly one in 10 expects to take on more debt to pay their current mortgage.

With borrowing costs likely to rise further, Canadians surveyed were equally gloomy about selling, with nearly one in five expecting their home to never reach the value it had before the 2022 rate increases, according to the survey.

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Martha Vallance, chief operating officer of Dye & Durham, said the ripple effect this drop in sentiment will have on businesses dependent on consumer spending and property transactions in 2023 is significant.

“The effects that the double whammy of rising interest rates and recessionary concerns are having on housing spending and plans cannot be underestimated. The average Canadian is preoccupied with what lies ahead and preparing for a recession by tightening spending and delaying major purchases,” Vallance said in the press release.

And we are concerned, according to the poll. More than half, 53%, of Canadians believe the country is on the verge of a recession, while 30% believe we are already in one.

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Canadians are equally pessimistic about the Bank of Canada’s rate stance, with a third saying they expect the Bank to hike another 100 basis points before the end of the year, taking the rate to 4 .25%.

Disturbingly – especially for central bankers who want to stifle inflation expectations – nearly half, 48%, say they don’t think interest rate hikes so far have slowed inflation , and more than half, 53%, think inflation will continue to rise over the next six months.

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IN THE NEW New Conservative Party leader and incoming Prime Minister Rishi Sunak waves as he leaves Conservative Party headquarters in London after being announced as the winner of the leadership race on Monday. Sunak was named Conservative leader and next Prime Minister of the UK after being the only candidate to garner more than 100 votes from Conservative MPs in the competition for the top job. He was appointed Prime Minister by King Charles today, replacing Liz Truss, who lasted just 44 days before she resigned. Read more about the latest UK leader below in today’s leading indicator. Photo by Dan Kitwood/Getty Images

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  • Natural Resources Minister Jonathan Wilkinson to speak at the Canadian Club Toronto
  • Louise Chabot, Bloc Québécois critic for human resources, skills development and social development, will hold a press briefing on employment insurance for seasonal workers
  • Special Committee on Canada-People’s Republic of China Relations Meets in Ottawa
  • Natural Resources Minister Jonathan Wilkinson; Todd Smith, Ontario Minister of Energy; Ken Hartwick, President of Ontario Power Generation; and Ehren Cory, CEO of the Canada Infrastructure Bank, will make an announcement on nuclear power
  • The Standing Committee on International Trade meets with Nadia Theodore, Ambassador and Permanent Representative of Canada to the World Trade Organization
  • Energy, Mines and Resources Minister John Streicker and Community Services Minister Richard Mostyn make an announcement about the new Better Buildings program that supports energy-efficient renovations to Yukon homes and buildings
  • Today’s data: S&P CoreLogic Case-Shiller Home Price Index, US Conference Board Consumer Confidence Index
  • Earnings: Canadian National Railway, Lundin Mining, First Quantum Minerals, First National Financial, General Motors, General Electric, Halliburton, Coca-Cola, Alphabet, Visa, Twitter Microsoft

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Rishi Sunak, 42, became one of Britain’s youngest leaders of modern times when he was sworn in as Prime Minister today after winning the Conservative Party leadership race. In fact, the youngest in 200 years.

The multi-millionaire former hedge fund boss is also one of Westminster’s wealthiest politicians. A former Goldman Sachs analyst, Sunak has become the latest in a long line of former Goldman employees to become policymakers in the Group of Seven economies, Bloomberg reports. From December 2005 until last Sunday, there has always been a Goldman Sachs alumnus serving as G-7 prime minister, finance minister or central bank chief. Mark Carney, former governor of the Bank of Canada and the Bank of England, was one of them.

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The race was only halted when Mario Draghi stepped down as Italy’s prime minister on Sunday. Today’s chart is from Bloomberg.

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Are you on an adjustable rate mortgage and starting to sweat as the Bank of Canada raises rates? Those feeling the pressure on their budget might consider opting for a fixed rate mortgage. But before taking the plunge, it’s good to know all your options.

Our content partner MoneyWise can help.

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Today’s Posthaste was written by Pamela Heaven (@pamheaven), with additional reporting from The Canadian Press, Thomson Reuters and Bloomberg.

Do you have an idea for an article, a pitch, an embargoed report or a suggestion for this newsletter? Email us at posthaste@postmedia.com, or hit reply to send us a note.

Listen to Down to Business for in-depth discussions and information on the latest in Canadian business, available wherever you get your podcasts. Check out the latest episode below:

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