Monday January 28, 2008

Singapore SIBOR interest rates fall to 1.5%, lowest since Dec 2004

This article belongs to the Singapore SIBOR rate watch story arc.

:

businesstimes.com.sg :

Mortgage rates are affected by the Singapore interbank offered rate (Sibor) - the rate at which banks lend to one another. And mortgage rates should follow the Sibor's downward trajectory. Yesterday [25 Jan 2008], the three-month Sibor fell to 1.5%, its lowest level since December 2004. It was hovering around 2.5% last year. Mortgage consultants are of the view that Sibor is trending downwards, and consumers would benefit should they refinance their loans to Sibor packages.

Economists say it is expected to go even lower by mid-year, partly due to the US steadily cutting its key interest rate. Sibor takes its cue from interest rates in the US, and earlier this week the US Federal Reserve slashed its key interest rate from 4.25% to 3.5%.

- This could be a homeowner trap, like the ARM packages in the US. Just when people think that low interest rates are here to stay, they start to rise, and mortgate payments tied to the floating rates start to reset to the higher rates, and at the same time the homeowners discover that the economy isn't doing too well. Now, haven't we seen this movie before?

In the meantime, enjoy the easy money while it lasts.

See also :

1. Fed cuts interest rate 3/4 of a point
2. Singapore interbank rate hits 7-year high [3.1875% on 23 Nov 2005]

Updated :

1. Singapore SIBOR rate fell to 1.25% in Apr 2008, lowest since Aug 2004
2. Singapore SIBOR rate falls to 1.31%, lowest since Nov 2004

(2008-01-28 23:49:52 SGT) [Biz] Permalink Comments [1]

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