ACCORDING to information released earlier today by the European Central Bank, Cypriot banks charge the highest interest rates for housing loans in the euro area. The gap between the average housing loan in Cyprus and that of other countries in the euro area is 239 base points.
The European Central Bank interest rate figures for housing loans in Cyprus was 6.78% in March, down marginally from 7.06% in February. Compared to January 2008, there has been an increase of 114 base points, despite a euro area base rate cut by 275 base points.
The cost of consumer borrowing is also very high. In March, the interest rate was 8.22%, down slightly from the February figure of 8.29%. In the euro area, the cost of consumer borrowing fell to 8.12% in March from 8.39%.
This is the first time in recent years that interest rates have been higher in Cyprus than in the rest of the euro area.