Swedes on a Debt Binge Now Face Test of Rising Mortgage Rates
BySweden’s housing market is decoupling from monetary policy as mortgage rates are starting to rise after a four-year swoon.
While the central bank last month pledged to keep its benchmark rate unchanged until early 2017 at a record low of minus 0.35 percent, some banks are increasing loan rates to cover rising funding costs amid concern over the red-hot housing market. That could put the pinch on the Swedish consumer.
“To have interest rates this low isn’t sustainable,” Hans Lindblad, director-general of the National Debt Office, said in a Nov. 4 interview. “Above all, young households don’t realize that in normal times interest rates may be 4-6 percent, not 2 percent, and that’s something that households need to be able to handle.” …
Swedes on a Debt Binge Now Face Test of Rising Mortgage Rates
