30 June 2010
In addition to it, the spread between discounted 5-year fixed rates and the bond is now 2.09%. It’s the highest level for the last 15 months. Moreover, the 10-year average is 1.25.
High spread means high profit for lenders. It can also be a sign of too high fixed rates. The last time the 5-year yield was 2.30%, discounted five-year fixed rates were only 3.75%. And now the banks give us their 4.49% “special offer”.
Should we expect more changes? We’ll see…