Interest rates change from time to time due to various factors, including:

Monetary Policy: Central banks, such as the European Central Bank, use interest rates as a tool to manage the economy. They adjust interest rates to control inflation, stimulate economic growth, or curb excessive borrowing. ECB interest rate increase forces banks to increase their loans and deposits interest rates to remain in line with the economic environment. Since the ECB interest rate is effectively an overnight rate (the rate used by banks to borrow and place funds in ECB for one night) banks have to forecast ECB rate dynamics to set interest rates on their long-term loans and deposits.

Economic Conditions: Interest rates are influenced by the overall economic environment. Factors such as economic growth, inflation rates, employment levels, and consumer spending impact the supply and demand for credit. In times of economic expansion, interest rates may rise to manage inflationary pressures. Conversely, during economic downturns, central banks may lower interest rates to encourage borrowing and stimulate economic activity.

Market Forces: Interest rates are also affected by market forces, such as supply and demand dynamics for loans and deposits. Banks compete for funds and adjust their interest rates accordingly. If a bank needs to attract more deposits, it may offer higher interest rates. Similarly, if there is a high demand for loans, banks may raise interest rates to reflect the increased cost of lending.

Geography. Observations show that interest rates depend on the country. Banks in different countries set different interest rates due to variations in savings volume, liquidity in the country's banking system, and the level of sovereign credit risk.

Risk Factors: Different banks may offer varying interest rates due to differences in risk profiles. Banks assess the creditworthiness of borrowers and factor in the associated risks when setting interest rates. The same works in the opposite way: the bank with lower credit quality will tend to offer higher deposit interest rates to attract additional customers covering the credit risk with interest rate premium.

Business model and market position: It's important to note that interest rates are influenced by factors specific to each bank's business strategy, market positioning, and liquidity needs (e.g. extensive business growth or outflow of existing clients can lead to liquidity deficit). As a result, interest rates can vary between different banks based on their individual circumstances, and their strategies.