The Central Bank of Costa Rica has announced that starting from July 18th the base rate will increase from 6.60% to 6.65%.
Crhoy reports: "The PBR will rise after remaining for four consecutive weeks at 6.60%, the lowest level since the application of the new calculation method, adopted in December 2012, and one of the lowest in the last four years ".
The Central Bank of Costa Rica reported that from the 11th and until at least the 18th of July, the base rate will remain at 6.60%.
José Luis Arce, an economist at Consejeros Económicos y Financieros (CEFSA), stated that the base rate is close to reaching its lowest level and therefore he does not foresee any significant drops from now on.
"There is a small margin with respect to the current real interest rate and in addition investor appetite for dollar-denominated instruments has increased, precisely because of a rebound in returns from the currency," he added.
The Central Bank has reported that for the third consecutive week the base rate will remain at 6.60%.
"Recently the PBR has had periods of stability of three consecutive weeks, after which there has been a downward shift. This has been happening since May 9, when it changed to 6.70%, three weeks later it dropped to 6.65% and then to 6.60%," noted an article in Elfinancierocr.com.
Keeping a level close to the lowest in the last four years, for the second consecutive week the central bank calculated the base lending rate at 6.60%.
Crhoy.com reports that "with this percentage the rate has reached its lowest level since the implementation of the new calculation methodology adopted in December 2012, and one of the lowest in the last four years."
The central bank has lowered its policy rate from 5% to 4%, while the passive base rate has dropped from 6.65% to 6.60%.
"The board of directors has observed a trend that reflects the absence of demand pressures, as evidenced by the decline in the pace of economic growth, according to a recent evolution of the Monthly Index of Economic Activity (MIEA).
The Central Bank of Costa Rica reported that from June 13 for the third consecutive week the PBR will remain at 6.65%.
Crhoy.com reports that "with this percentage the rate has reached its lowest level since the implementation of the new calculation methodology adopted in December 2012, and one of the lowest in the last four years."
"The PBR is calculated with information from the gross interest rates negotiated for each of the business acquisitions, for periods of 150 and 210 days during the week preceding the calculation (Wednesday to Tuesday), by financial intermediaries, Excluding only the Ministry of Finance and the Central Bank of Costa Rica (BCCR ").
The Central Bank of Costa Rica reported that starting this June 6 the base rate will remain for the second week at 6.65%.
"The PBR is used as a reference for most loans in colones granted by financial institutions," reported Nacion.com.
"With the new methodology for calculating this indicator, approved by the Central Bank last December, the rate is rounded to the nearest five base points rather than 25 base points as before."
The Central Bank of Costa Rica reported that as of May 9 the passive base rate will be set at 6.70%, down 0.05% from the previous week.
"With this reduction, the basic passive rate (TBP) reaches its lowest level since February 2008. At the beginning of this 2013, the indicator was at 9.20%, so it has lost 2.5% in just four months. A year ago, the TBP was by 10%," noted an article in Elfinancierocr.com.
The Central Bank of Costa Rica said that the new formula for calculating the base rate means that it will be a more stable indicator.
Rodrigo Bolaños, president of the institution, explained that this will help over 400,000 borrowers who have credit obligations linked to this indicator.
The new methodology was presented yesterday and today will be published in the official gazette, meaning that it will become effective within 10 days, if there are no comments.
After a warning by President Chinchilla to state commercial banks, the financial entities involved have put their interest rates on a diet.
The passive base rate, an index calculated by the Central Bank of Costa Rica (BCCR), is a weighted average of the interest rates in colones on gross savings, negotiated by financial intermediaries resident in the country and the interest rates of collection instruments of the Central Bank and Ministry of Finance negotiated both in the primary and secondary market, each corresponding to periods of between 150 and 210 days.
The financial oligopoly of the main state-owned banks in Costa Rica has the most weight in setting the Passive Base Rate, and has its earnings tied to it.
Although a 2008 revision of the method of calculating the Passive Base Rate (PBR) included the opinion of the Central Bank of Costa Rica and the Ministry of Finance along with the public banks - who control the money market -, the weight of the latter in determining the benchmark rate is still considered excessive.
The Central Bank of Costa Rica has reduced the Passive Base Rate (PBR) by 25 basis points, standing now at 9.50%.
This value is the same as that reported on June 21.
"In the calculation published today and which will come into force on July 5, public commercial banks lowered their interest rates from 9.7% to 9.58% and being the most important in the weighting the PBR was lowered", reports Elfinancierocr.com
The basic passive rate has gone down and stands at 8.75% from Thursday 16th until next Wednesday 22nd February.
"The decline in the indicator is driven by a decline in average rates paid by public commercial banks, it went from 8.90% to 8.73%. These entities are those with the most weight relative to the calculation made by the Central Bank of Costa Rica", reports Elfinancierocr.com