Europe's monetary policy remains tight and the money supply is shrinking, Tiina Helenius, chief economist at pension insurance company Elo, said in an interview with Kauppalehti. She predicts that the ECB's base interest rate will fall below 3% this year and approach 2% by next summer, dv.ee writes. Interest rates are falling rapidly, and economists Lasse Korin and Tiina Helenius predict that the 12-month Euribor will fall below 3% during the course of this year. On Thursday, the 12-month Euribor, which is commonly used to calculate the cost of mortgages in Finland, fell to its lowest level this year, at 3.1%. Just a week ago, the 12-month Euribor was at 3.2%, and a month ago it was 3.5%, indicating a rapid decline. "If we look at the forecasts for interest rate futures, the base interest rate will be slightly above two percent next summer," says Tiina Helenius, chief economist at pension insurance company Elo. Aktia chief economist Korin also believes that it is possible that the 12-month Euribor will fall below 3% by the end of the year. Read more on dv.ee.
