Bank customers in Ireland have seen increases in European Central Bank interest rates passed through to savers and also to new mortgage customers at a weaker rate than those living in other euro area countries.
This means these rates have not risen by as much as the increases in other eurozone states since the current cycle of rising rate began in July of last year.
But new research by the Central Bank also found that for other products, the pass-through has been similar to that seen in other eurozone nations.
The economic letter, written by David Byrne and Sorcha Foster, also found that the pass-through in the euro area is weaker now relative to previous cycles for some deposit products.
However, it is stronger for new business lending and business term deposits and broadly the same for mortgages and outstanding business loans.
"Understanding how long and how variable the lags of monetary policy will be in this tightening cycle is more challenging, due to the considerable changes in the economy and the financial system since the last major tightening cycle, more than 15 years ago," said Deputy Governor Vasileios Madouros.
"To date, we have seen weaker interest rate pass-through in Ireland for deposits and for new mortgage rates compared to our euro area peers."
"Potential factors driving these trends include the relatively ample deposit base of the Irish retail banking system and the evolution of competitive dynamics within the market for banking services."
So far, the ECB has increased interest rates by 4.25% in a number of changes since July of last year, in an effort to tame inflation.
The rate of pass through of those changes is important because the rates are increased in order to control the amount of spending and consumption in the economy, with the hope it will bring the speed at which prices are rising down.
"Effective transmission of the ECB's monetary policy to the domestic economy via the banking system is key for the fight against inflation," said the Deputy Governor.
"Given historical patterns, we expect the banking channel of monetary policy transmission to continue to strengthen in the months ahead and will continue to monitor the transmission using a wide array of indicators and analysis."
