Belgian interest rate reaches highest level in ten years

Belgium's 10-year interest rate rose to 3.19 per cent on Friday, the highest level since mid-2012. Interest rates rose more than 14 basis points on the last trading day of the year.

The rise in secondary market interest rates is a general trend linked to the European Central Bank's (ECB) announced interest rate hikes. Higher long-term interest rates make loans more expensive and could make it more difficult for the Belgian government to raise money in the financial markets in the future.

Interest rates are rising at breakneck speed. Just in March this year, Belgium's 10-year rate breached the 1 per cent mark, rising to 3 per cent in October. Early this month, the rate fell back to 2.3 per cent, the lowest point in months, but reached 3 per cent again just before Christmas after the ECB's latest meeting.

The ECB meeting also triggered many banks operating in Belgium to raise interest rates on savings accounts, including Belfius, KBC, VDK bank, Triodos, Deutsche Bank, Crelan, AXA, ING and Argenta. 

(KOR)

^{© BELGA PHOTO / IMAGEGLOBE JONAS HAMERS}