Just minutes after the announcement from Erik Thedéen that the Riksbank is lowering the benchmark interest rate to 2.75% from 3.25%, major banks quickly followed suit.
Leading the way was Handelsbanken, which cut its mortgage rate with a three-month lock-in period by 0.5 percentage points to 4.79%.
SEB quickly followed by reducing its short-term mortgage rate by 0.50 percentage points to 4.74%. Fixed-rate mortgages are also being lowered by between 0.15 and 0.25 percentage points depending on the term.
Swedbank took a more cautious approach, lowering its three-month rate by 25 basis points. The bank had already cut rates by 25 basis points on November 1, resulting in a total reduction of 0.5 percentage points so far in November. Some of the fixed mortgage rates are being reduced by between 0.05 and 0.15 percentage points.
Nordea is also joining the trend by reducing its three-month rate by 50 basis points.
Länsförsäkringar Bank is lowering its variable mortgage rate by 50 basis points to 4.74%, while keeping other lock-in periods unchanged.
Danske Bank is cutting its one-year mortgage rate by 0.25 percentage points, with a further reduction of 0.5 percentage points coming for the three-month rate on Monday.
The decision by these major banks to lower their mortgage rates in response to the Riksbank’s move reflects a broader trend in the financial sector. As central banks around the world adjust their monetary policies in the face of economic uncertainty, banks are under pressure to pass on these rate cuts to consumers.
The impact of these rate cuts on the economy remains to be seen. While lower mortgage rates can stimulate borrowing and spending, they can also lead to concerns about asset bubbles and financial stability. As the global economy continues to face challenges, the actions of central banks and major financial institutions will be closely watched for their implications on growth and stability.