Interest rates heading north; Singapore to feel full impact in 2023

Brokers say some banks have already raised 3-year fixed rates by 5-10 basis points in October, up from an all-time low in September

Kelly Ng

Published Mon, Nov 15, 2021 · 05:50 AM

Mortgages

Singapore

DOMESTIC borrowing rates will inevitably head north in 2022, with the US Federal Reserve inching closer to a rate hike as it starts tapering bond purchases.

The questions are when, and by how much, mortgage brokers and bank executives said, with most agreeing that the full impact of these global actions on Singapore will only be realised in 2023.

As it is, some banks here have already raised 3-year fixed rates by between 5 and 10 basis points in October, up from an all-time low in September, the brokers said.

Banks have cited a "tremendous increase in cost of funds", said Clive Chng, associate director of RedBrick Mortgage Advisory.

"I think the banks will definitely wait to observe the market, before they move rates again. But as of now, the cost of funds has increased a bit, so that has pushed the b…