Monetary and financial trends - Decline in interest rates and refinancing boom

Analysis - September - No. 19

Authors Danmarks Nationalbank
Subject Danish Economy; Current economic and monetary trends; Monetary- and foreign-exchange; The money and currency markets; Monetary- and foreign-exchange policy; Monetary policy; Monetary-policy instrument; Foreign-exchange market; Financial assets and balances; Fixed-exchange-rate policy
Type Analysis
Year 2019
Published 18 September 2019
In September, Danmarks Nationalbank lowered the interest rate on certificates of deposit by 10 basis points to -0.75 per cent. The interest rate reduction is a consequence of the reduction by the European Central Bank of its key monetary policy rate by 10 basis points. The krone rate remains stable, being slightly on the weak side of the central rate. Overall, financial conditions are accommodative and support the ongoing economic upswing. Declining interest rates have triggered a new refinancing boom during which many households have opted for lower-rate home loans. Credit growth remains moderate and has slowed slightly in 2019.