An ECB rate cut is expected next month, but after a blow to borrowers there could be a pause before another cut.
Yannis Stournaras, member of the ECB Governing Council, said the Bank of Greece had assessed recent inflation and growth data from Eurostat and that “we now consider three interest rate cuts in 2024 as the most likely scenario”.
The ECB appears ready to cut rates when policymakers meet next month.
The ECB refinancing rate was expected to be cut by 0.25 percentage points, equivalent to 4.5%.
It was then expected that three more cuts could take place by the end of the year. But now there may be only three cuts this year.
Each reduction of 0.25 points will provide €15 off the monthly repayments on a typical tracker. Most people with a tracker still owe around $100,000 and have about 15 years to pay.
There are around 180,000 homeowners with tracker mortgage rates who would directly benefit from any ECB cuts.
People stuck in vulture funds that don't allow them to lock in their mortgage rates are also likely to benefit, with 70,000 borrowers getting off fixed rates this year.
Rents in existing leases are now rising three times the permitted level under rent cap rules
Mortgage rate reductions have already been implemented by AIB and its subsidiaries Haven and EBS, for those who qualify for a green interest rate.
AIB, EBS and Haven also increased the cash incentive for switchers from €2,000 to €3,000.
And Bank of Ireland has introduced a range of discounts on its fixed rates for people with any BER, not just B3 or better.
It also introduced a new fixed variable rate instead of a range of variable rates.
PTSB has reduced a number of fixed rates.
Avant Money reduces the mortgage interest rate by a maximum of 0.45 percentage points.
And there will be a “technical” adjustment in rates in September, which will benefit tracker holders, as the ECB refinancing rate will be cut by 0.35 percentage points.
Mortgage broker Michael Dowling of Dowling Financial in Dublin said the ECB still expects to cut interest rates from June, with a cut of 0.25 percentage points.
This will be good news for the 179,000 tracker mortgage customers with €15.4 billion in outstanding debts, he said.
“The average outstanding balance is €133,000, so the discount is €16 per month.”
Melanie Baker, senior economist at Royal London Asset Management, said: “ECB speakers continued to signal a rate cut in June, but the picture beyond that point looks bleaker and remains data-dependent.”