The Dutch long-term interest rate, based on the return of the most recent ten-year public loan, averaged 2.2 percent in January 2012, i.e. 0.2 percentage points down on December 2011. In January, the interest rate reached the lowest level in decades.
In December 2011, the European Central Bank (ECB) decided to change various interest rates. The most important ECB rate, the repo rate, was lowered by 0.25 percentage points to 1.0 percent on 14 December 2011.The deposit rate, often considered as the bottom rate of the financial market, was also reduced by 0.25 percentage points, to 0.25 percent. Both rates had also been lowered by 0.25 percentage points in November.
One of the main guidelines for the ECB’s decision to change or refrain from changing the interest rate is the level of inflation in the eurozone. According to the ECB, eurozone prices are stable, if the inflation rate is close to 2 percent. Eurostat, the statistical office of the European Union, recorded an inflation rate of 2.7 percent in the eurozone in January 2012, the same as in December.
Capital market interest rate (latest ten-year public loan)