SIBOR OR NOT???

Between 1988 and Aug 2008, Interbank rates have almost reached 9%. During recession years of 2002 and 2005, interest rates hovered around 1%. However it has risen to 3+% from 2006 to 2007 only starting to fall dramatically back to around 1% in 2nd half of 2008.

Differences between 2002 to 2005 and 2008.

During 2002 to 2005, inflation are low, while in 2008, inflation is still high (~5-6%). This negative interest rate to inflation rate is typically rare. This could indicate intervention.

But then, nobody really knows where the rates will end up. If you cannot stomach the full risk, take some precaution such as a mix of Fixed Rate and Variable Rate mortgage to cushion the risk of fluctuation.