What's going on?

Nordea is practically giving new homes away: the Nordic bank started offering its Danish customers interest-free 20 year mortgages on Tuesday (tweet this).

What does this mean?

Denmark might be small economically speaking, but it�s a big deal when it comes to interest rates: the country�s rates have been negative since 2012 � longer than anywhere else in the world. That environment has encouraged its banks to slash their mortgage rates to unprecedented levels too, with Jyske Bank launching the world�s first negative rate mortgage two years ago � effectively paying borrowers to take out the loan. And now Nordea has once again decided to offer super-cheap mortgages, while others like Danske Bank � the country�s biggest � signaled they may follow suit.

Denmark�s not the only country whose mortgage rates are plummeting. With major central banks slashing interest rates to boost their pandemic-hit economies, commercial banks worldwide have been doing much the same thing. Just look at the US: the country�s mortgage rate dropped to 16 record lows in 2020, and it�s now just shy of its lowest level since tracking began.

Why should I care?

For you personally: Stay sharp out there.

With coronavirus still wreaking havoc on the world�s economies, central banks aren�t exactly likely to raise interest rates this year. That�s important to know: low rates are good for stocks, spurring on company earnings by lowering borrowing costs. Just be ready for the moment you do catch wind of an interest rate hike: it could have the opposite effect.

Zooming in: Stay safe out there.

Bonds should � at least in theory � be less popular among returns-hungry investors when interest rates are so low. But even though more than a quarter of global bonds are currently offering negative yields, investors are still flocking to them. That might have something to do with just how much value investors put on �safe haven� assets in times like this.