What will happen to the loans after the interest rate reduction?

2024-07-10 10:40:12Biznes SHKRUAR NGA REDAKSIA VOX

After seven increases in the base interest rate, the Supervisory Council of the Bank of Albania decided to lower the interest rate by 0.25%. But how will this be reflected in the interest on loans and deposits in second-tier banks?

Invited to the 3D Economy Show, finance expert Artan Gjergji emphasized that it is now time for the interest rate to reflect a moderate reduction in loan costs.

"There will be an easing of loan costs, but on the other hand banks will reflect and this is a phenomenon that always happens. Banks will reflect the monetary policy many times faster than the monetary policy on deposits because they are more interested in collecting money from circulation at the lowest cost".

But how should they currently act with citizens with their deposits?

"They should see the alternatives available to them. I suggest they be in short-term deposits or treasury bills. If you need the money, invest in long-term periods of 3.5.10 years as there are higher rates of return."