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Old 08.01.2014, 07:04
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Interest Rates, 2014 and beyond

Apart from wild "we're all doomed" headlines, anyone have any thoughts on interest rates in the short / mid term in CH ? They were of course 'going back up' last year but in fact that rise has tapered off. Credit Suisse showing recently a lowering of the rate for a 5 year fix for example.

We may buy a house this year, and previously while the thinking has always been "10 year fix! 10 year fix! 10 year fix!" I am wondering whether in reality if rates will eventually go back up if that isnt going to start happening for 2-3 years I might be better getting one of those very low variable rates then re-doing it in 3 years or so..

I know its crystal ball stuff, but if anyone wants to chime in...
mike
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Old 08.01.2014, 09:34
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Re: Interest Rates, 2014 and beyond

Well one thing you might want to think about is hedging your bets:
Put part of the mortgage on 10 years, part on 3/4/5 or whatever and maybe leave part on non-fixed?
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Old 08.01.2014, 11:43
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Re: Interest Rates, 2014 and beyond

I've seen most people in my office going with 10 yrs fix. I think the interest rate doesn't change much in each year.
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Old 08.01.2014, 11:51
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Re: Interest Rates, 2014 and beyond

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I've seen most people in my office going with 10 yrs fix. I think the interest rate doesn't change much in each year.
Except when it goes up to 7%, as has happened in the past.
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Old 08.01.2014, 15:52
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Re: Interest Rates, 2014 and beyond

yes but a long time in the past. for the next few years I think it will remain fairly low so for now a libor for say 3 years then remortgage might be good.
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Old 08.01.2014, 15:57
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Re: Interest Rates, 2014 and beyond

If you're absolutely certain you will not want to move in the short term... go for a 10 year fixed, interest rates are only heading one way in the next few years.

But be aware of the massive payment penalties if you want to / have to get out of the agreement within the fixed term.
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Old 17.09.2015, 20:24
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Re: Interest Rates, 2014 and beyond

Temporary relief for emerging markets. America’s central bank announces it will not raise borrowing costs for the first time since the financial crisis began ...

http://www.theguardian.com/business/...et-yellen-live

Or even more refined source ...

http://www.bbc.com/news/business-34286230
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Old 17.09.2015, 21:28
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Re: Interest Rates, 2014 and beyond

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Temporary relief for emerging markets. America’s central bank announces it will not raise borrowing costs for the first time since the financial crisis began ...

http://www.theguardian.com/business/...et-yellen-live
Thats a real shame as I had hoped for a rise. The economy will improve when people start getting some interest on their savings.
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Old 17.09.2015, 21:33
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Re: Interest Rates, 2014 and beyond

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Thats a real shame as I had hoped for a rise. The economy will improve when people start getting some interest on their savings.
I, for one, am happy because I'm really sick and tired of seeing my long term investments in ZAR to drift away when RSA's currency loses every time US breaths. It's only a little consolation for now though
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Old 18.09.2015, 09:54
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Re: Interest Rates, 2014 and beyond

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Well I have recently invested my money abroad!
Think we all need to think long term.
Let me know if you think of investing elsewhere??
Good luck with your forex hedging.

As an example, if you'd invested in AUD three years ago to take advantage of the very attractive deposit interest rates there (say, 4.0% p.a.), with annual compounding your savings could have grown by about 12.5% by now... and converting back into CHF today, would be worth (including the interest earned) 24.4% less than the original investment.

CHF 100 invested in AUD in August 2012 would be worth CHF 75.60 today, after interest earned.
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