Long-term rates refer to government bonds – whose capital repayment is guaranteed by governments – maturing in 10 years. Just like short-term rates, long-term interest rates are generally averages of daily rates, measured as a percentage. Nevertheless, while the central bank sets the overnight rates and thus can influence short-term rates, it has much less influence on long-term rates, which are set by the markets. Indeed, given that these interest rates relate to government bonds, they are influenced by the state of the economy of the country that issues those bonds − notably its fiscal conditions, the growth of its GDP, its level of foreign borrowing, the productivity of its labour, its demographic evolution, and its current and expected inflation. This explains the variance in long-term interest rates between euro area Member States shown below.
By European Parliamentary Research Service
/ September 23, 2016
Long-term interest rates for France, Italy and Germany, Jan 2011 – April 2016
Long-term interest rates for France, Italy and Germany, Jan 2011 – April 2016
Categories:
European Parliamentary Research Service
Related Articles
In focus
We write about
Blogroll
Disclaimer and Copyright statement
The content of all documents (and articles) contained in this blog is the sole responsibility of the author and any opinions expressed therein do not necessarily represent the official position of the European Parliament. It is addressed to the Members and staff of the EP for their parliamentary work. Reproduction and translation for non-commercial purposes are authorised, provided the source is acknowledged and the European Parliament is given prior notice and sent a copy.
For a comprehensive description of our cookie and data protection policies, please visit Terms and Conditions page.
Copyright © European Union, 2014-2024. All rights reserved.
Be the first to write a comment.