Markets & Economy

Eurozone rate cut could boost mortgage lending and give overseas investors more buying power

Weaker euro would benefit buyers paying in dollars, yen and renminbi

This article by OPP Connect editor Adrian Bishop is reposted with permission from OPP Connect. Currency and financial experts believe the 0.1 percent cut in the European Central Bank (ECB) benchmark and the historic deposit rate reduction to below zero could weaken the euro, benefiting international homebuyers funding purchases of eurozone properties using other currencies like the dollar, yen and renminbi. The ECB on Thursday reduced its deposit rate to -0.1 percent, meaning that commercial banks will have to pay to lodge their money with the central bank. The ECB also cut its benchmark interest rate to 0.15 percent from 0.25 percent and imposed other measures to help banks lend more to small businesses and households. Marc Morley-Freer, director of sales for Currencies Direct, tells OPP Connect the move could see a further fall in the euro, benefiting foreign buyers with stronger currencies. If quantitative easing (QE) follows, the property market could receive an extra b...