Pearse Doherty (Donegal South West, Sinn Fein) | Oireachtas source

I am not concerned about the rate that is falling or the rate that is increasing from 12.5% to 13.5% because that is the direction in which banks are going but in respect of the mortgage rate, that is falling from 5% to 4%, which is completely out of kilter with the trend of where mortgage rates are going this year, or the projected trend and where they have been for the past six months. Mortgage rates have been increasing in the past six months, not decreasing. While the Minister is right to say AIB's mortgage rate is about 4% and Bank of Ireland is about 4.25%, these banks, particularly AIB, have indicated it will increase the rate. All the institutions have signalled that rates will go in only one direction, which is up. While this will be reviewed in a year's time, we will be back this time next year to look at these rates again, but in the intervening period it is expected that banks will increase their rates. It does not make sense that we are decreasing the rates in terms of preferential loans to employees while the trend in the market is upwards. Does the Minister believe that mortgage interest rates in the markets will come down or does he think they will go up? If they will go up, why is the rate being reduced?