The fact that the European Central Bank (ECB) is raising interest rates is the main measure it has to fight against the high inflation we are experiencing, largely caused by the cost of fuel. As individuals, how does this affect us? In short, money will be more expensive for everyone. If the price of money is higher, financing will be too. Consider that, when a bank calculates the interest rate of a loan, the operating margin is added to its cost. Therefore, we can expect an increase in the cost of new consumer loans.

Buying a car in installments, taking out a loan to renovate a house, or financing a business investment will be a little more expensive. The European Central Bank (ECB) has decided to increase interest rates by a quarter of a percentage point, to 2.5%, with the aim of curbing the price escalation caused by the war in Iran.

Public debt yields have experienced a significant climb in recent weeks, reaching levels not seen in two decades. Fears of inflation and, therefore, the forecast of new interest rate hikes have driven sales of these assets. The fact is that if the cost of living becomes more expensive, the fixed interest paid by a bond loses purchasing power and, consequently, investors sell the securities they hold in their portfolios and demand higher profitability on new issues.

The meeting of central bankers, academics, politicians and businessmen in Jackson Hole – the mountain area of the state of Wyoming, in the United States – which began this Thursday, marks the economic week and the start of the course. The summit, which lasts until Saturday, has an impact not only on the world's leading economy, but on that of the entire planet. It is expected that the president of the Federal Reserve (the Fed) of the USA, the country's central bank, Kevin Warsh, who replaced Jerome Powell last May, will give clues this Friday in his speech as host about his policy against inflation. In the time he has been in office, he has not yet clarified it. Despite assuring that his objective is that the general increase in prices be 2%, far from the current level, he has not explained what path he will follow to achieve it. This has generated doubts among investors.

The meeting of the Governing Council of the European Central Bank (ECB) has been transitional. After raising interest rates by about 0.25 percentage points last month, Frankfurt has avoided making a move while awaiting developments in the Middle East and has kept them at 2.25% this Thursday.

After three consecutive increases (March, April, and May), the daily one-year Euribor in June, the main reference for variable interest rate mortgages, has moderated and experienced a slight decrease compared to the previous month. The indicator closed the month at 2.728%, and therefore, an average in June of 2.798%, below the 2.8% of the previous month. In any case, the amount paid by mortgagors will continue to rise, with an increase of 66.40 euros per month and 796.8 euros per year on average, as it is compared to the 2.081% that existed a year ago.

The war in the Middle East that began on February 28 with attacks by the United States and Israel on Iran has, obviously, had an economic impact. After four months, and with the agreement between the United States and Iran, it is difficult to quantify the total cost of the war in economic terms. But what is clear is that the impact has fallen directly on citizens' pockets and has weakened economic growth in many areas of the world, especially in Asia-Pacific, with greater dependence on Gulf oil.

If we had had this conversation in January, most economists were clear: 2026 was going to be the year of interest rate cuts. But, as the months have passed, the analysis has changed radically. Everything points to us ending the year with hikes.

The Federal Reserve (the Fed, the central bank of the United States) has decided to keep interest rates unchanged, despite the rising cost of living in recent months, the agency reported in a statement released this Wednesday. The meeting of the Federal Open Market Committee (FOMC, the internal body that makes monetary policy decisions) held between Tuesday and Wednesday was the first chaired by Kevin Warsh, who has aligned himself only partially with the requests of the President of the United States, Donald Trump, who since his return to the White House had demanded a cut in the price of money to boost economic growth.

Bad times are coming for holders of variable-rate mortgages. The daily 12-month Euribor, the main reference for this type of loan for home purchases, has closed the month with an average above 2.8% (2.804%) and is heading towards 3%, according to analysts. Thus, the monthly payment for an average mortgage of 174,132 euros with Euribor plus one point, which was 833.11 euros, will rise to 900.39 euros, an increase of 67.28 euros more or 807.36 euros more per year.

The European Central Bank (ECB) remains cautious. The banking institution has once again avoided making a move prematurely and, despite the war in Iran and the rebound in inflation, has decided this Thursday to keep interest rates at 2% for the seventh consecutive meeting. In this way, the financial entity chaired by Christine Lagarde keeps its powder dry in case the situation worsens and, in fact, has already warned of "the high uncertainty" of the Eurozone's economic future due to the war initiated by Donald Trump.

The daily one-year Euribor, the main reference for variable-rate mortgages, closed April with a new increase, reaching 2.848%. The average stood at 2.747%, compared to 2.143% a year ago, and a new increase is added to that of March. Consequently, this evolution, which places this reference at the levels of September 2024, means the average mortgage (173,280 euros, according to INE data from February, over 25 years) will increase its monthly installment by 55.94 euros or 671.28 annually, to 890.60 euros per month or 10,687.2 euros per year.

No one could have imagined, when the US and Israel launched the first attacks against Iran on Saturday, February 28, that especially Washington and, specifically, US President Donald Trump, had not foreseen the consequences. The evolution of events makes it increasingly clear: there was no strategy. At least, not on the part of the US. Another thing is the government of Benjamin Netanyahu, which takes advantage of the opportunity to achieve its expansionist goals, with no regard for international law and human rights.

As Spain prepares to close a record year for mortgage signings, potentially exceeding 500,000 across the country—levels not seen in fifteen years—a changing cycle is beginning with rising interest rates. "Most financial institutions are raising interest rates on home loans" because no further rate cuts are expected in the short term from the European Central Bank (ECB), explains the comparison website HelpMyCash.

Imagine you have €50,000 in your account and you need to make a payment of exactly that amount to buy a car. You have two options: pay it all in cash or apply for financing for the same amount. The first option seems the safest, since it frees us from any future obligations, but at the same time it decapitalizes us and leaves us with no available savings. In contrast, the second option allows us to keep the €50,000 in the account and pay for the vehicle in installments. The secret lies in the return we can obtain from that money.

The President of the European Central Bank (ECB), Christine Lagarde, has proclaimed a change of cycle. It all began after the pandemic and with the start of the Russian invasion of Ukraine: prices soared, and in an attempt to stem inflation, Frankfurt quickly and consistently raised interest rates—which had been stuck at 0% since 2016. Little by little, the rate of price increases has slowed, and the bank has cut the price of money at the same pace. Inflation has now stabilized around the 2% target, and therefore, this Thursday, the bank unanimously decided to keep interest rates at 2% at the ECB's governing council meeting.

Recent months have seen a bullish rally for the European stock market, and in the case of the Spanish stock market, the Ibex 35—the main Spanish index that groups the 35 most powerful companies—has been the subject of several headlines suggesting that the index was approaching its all-time high. This Friday, the index closed a weak week: it closed again below the 15,000 points it had managed to recover in August, remaining at 14,850.9. However, the index has accumulated growth of more than 30% in the last year (from August to August), and a 112% increase in the last five years, following the outbreak of the COVID-19 pandemic.

The word bubble Applied to housing, this creates fear. It reminds us of what we experienced seventeen years ago. Back then, the issue was financial, and the bubble of over-indebtedness burst, resulting in a demand that, in many cases, wasn't sufficiently solvent. Today, we can use the expression because we're not in that situation. As some experts claim, the current bubble It's about prices, meaning that the price per square meter is completely disconnected from income, wages, and economic growth. Its driving forces are demographic pressure, speculative investment, and the fall in credit prices.

With his obsession with imposing tariffs on all countries that don't yield to his demands, the US president demonstrates that he has little or no interest in the rules that have worked until now, nor in their enforcement. He hasn't hesitated for a second to rewrite them to his style and convenience, moving away from the canons of diplomacy and traditional political relations to achieve his goals, or at least make it seem that way.

What makes a meeting in a valley in the state of Wyoming, in an idyllic setting, so important? What makes the markets so focused on this annual gathering organized by the Federal Reserve Bank of Kansas City under the protection of the Rocky Mountains, which begins today, Thursday, and ends on Saturday? Interest during these August dates is always high, because this conclave is attended by central bank governors from the world's leading countries, along with finance ministers and business leaders. This is not surprising, because many pragmatic issues, such as whether mortgages will become more or less expensive and whether there will be more or less credit to invest in, depend on what is discussed at this meeting without ties and in a relaxed and discreet atmosphere, not only in the US but globally.