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Growing Financial Pains

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Growing Financial Pains

Stijn Leupe shares a post on the current, painful interest rates for both individuals and corporations. 

The financing pains: a lot of pain for private individuals and currently even more for corporations

For a lot of private individuals, financing the purchase of a house becomes extremely difficult due to the two to three times higher interest rate to be paid on a mortgage.

But for new loans to corporations the average interest rate on new loans gradually starts to reach the levels we saw after the financial crisis. Obviously, the shorter financing tenors for corporations, together with the still inverted interest rate curve over the short end, puts further upward pressure on the average interest rate for corporations. Given the expectation of high interest rates for longer, this pain is here to stay for a lot longer than what we saw during 2007-08.

 

View the full post on LinkedIn.