The 12-month Euribor rate rose to 2.93 per cent on Tuesday, marking its largest single-day increase since 2008 as market pressure linked to the Iran war pushed borrowing costs higher across Europe.<\/p>\n
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The benchmark rate, used for many mortgage loans, climbed from 2.74 per cent on Monday and has now risen by 0.7 percentage points since the start of March. The latest figure places it at its highest level since September 2024.<\/p>\n
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Nordea chief analyst Jan von Gerich said the move reflects growing instability in financial markets.<\/p>\n
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\u201cIn an uncertain market situation, euribors also fluctuate strongly, but such strong upward pressure on rates is unusual,\u201d he wrote on X<\/a>.<\/p>\n
<\/p>\n On Friday, the rate stood at 2.658 per cent<\/a> after the European Central Bank warned of renewed inflation risks<\/a>. It then climbed further at the start of the week before Tuesday\u2019s surge.<\/p>\n
<\/p>\n Von Gerich said developments in the Middle East now play a direct role in shaping European borrowing costs. \u201cThe situation in the Middle East now determines the path of euribors,\u201d he stated.<\/p>\n
<\/p>\n The volatility has already affected rate adjustments for households with variable mortgage loans. The 12-month Euribor serves as a key reference rate for many borrowers, meaning changes feed through into monthly repayments when loans reset.<\/p>\n
<\/p>\n Last week, the rate recorded another sharp move when it increased by 0.185 percentage points in a single day, before falling by a similar amount the following day.<\/p>\n
<\/p>\n Market participants expect continued instability as long as energy prices remain elevated and geopolitical risks persist. The link between commodity markets and interest rates has strengthened in recent weeks, with investors reacting to each shift in oil supply and demand.<\/p>\n
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