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Will there be more interest rate cuts this summer ?

It is true that food prices are not really rising as much now as before. Nevertheless, we are at a level that stretches the economy to the max for those who have already had problems before. A small consolation for those is that further interest rate cuts may be possible as early as this summer (though I think and write about Swedish market in this article, this could be valid for broader EU (but not US)).

The biggest mistake many people made when interest rates were at rock bottom was borrowing money in the hope that this was the new normal. The banks were probably no better for allowing too many people to stretch their loans beyond their breaking point. But that’s old news that has been discussed for a long time.

If you have the following three rules for your finances, you are pretty well protected:

• You can save ATLEAST 10% of your salary
• You live with the idea that mortgage rates should be 4% to 5%.
• You have a good buffer that is tailored to you. If you live in a rental apartment, you probably need less buffer than those who live in, for example, a villa. Also consider the risk of becoming unemployed and your chances of getting a new job.

If you have the above three mindsets with you, you will get by far even if the economy gets worse. Of course, there are a lot of other tips/benchmarks, but this is at least my simple list that I always find to be valid.

Unfortunately, if not all of these points followed. It can really bite the day you realize that the dry land you seemed to be standing on is not dry anymore.

What will the interest rate be in the future?

As usual, this is going to be a guessing game, but I think the banks have been relatively good with their fortune-telling in the past. Now, however, the banks’ forecasts are quite mixed, thanks to factors such as tariffs.

In any case, it is clear that many voices are heard with the same message: “interest rates should have been lowered earlier than they actually were. “

Make sure you can handle mortgage rates of an average of 4% to 5% and over time you will have a good margin. Anyone who increases their mortgage now as interest rates look brighter may very well be making a bad choice.

It will be an exciting time ahead, with the first real milestone already on June 18th, when riksbank comes with key interest rate information, in Sweden.