New inflation forecasts, published on Friday, make it possible to anticipate the future remuneration of regulated savings accounts. Confirmation: the Livret A, LDDS and LEP rates should double in August, and even go even higher in early 2023.
Franois Villeroy de Galhau, the Governor of the Bank, confirmed it last Wednesday: the Livret A rate, and with it other regulated savings accounts, will increase on 1 August. In what proportion? The head of the French central bank did not answer this question. He has two choices: strictly apply the regulatory calculation formula; or depart from it, if it considers, for example, that the result of this calculation does not preserve the purchasing power of savers.
If Franois Villeroy de Galhau opts for the first solution, which today seems the most likely, the projection of rates for next August 1 has been further refined today. INSEE has just published, in its new note on the economy, its inflation forecast, one of the variables taken into account in the calculation formula, for the month of June. She is on the rise: +5.9% over one yearagainst +5.6% announced in a previous note.
If this figure is confirmed, the Livret A and the LDDS should yield 2% net from August, ie a doubling compared to the current rate. The rate of popular savings booklet (LEP), it should rise to 4.6%, against 2.2% currently.
Theoretical rates on August 1
- Livret A: 2% (net of all taxes)
- Sustainable and solidarity development booklet (LDDS): 2% (net)
- Credit Mutuel Blue Book: 2% (net)
- Popular savings account (LEP): 4.6% (net)
- Housing savings account (CEL): 1.25% (gross, interest subject to social security contributions but also income tax on CELs opened since 2018)
A new inevitable rise in February 2023
In its note on the economy, INSEE also gives its vision of the rise in prices in the second half. According to the National Statistical Institute, headline inflation will first continue to increase this t, to stabilize in the fall between 6.5 and 7% over one year (…). As an annual average, inflation should rise to +5.5% in 2022 (after +1.6% in 2021).
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If this hypothesis is confirmed, annual inflation should hover around 6.5%, on average in the second half of the year, leading to a further increase in the remuneration of regulated savings in February 2023, or even from November 2022, as the regulations permit in exceptional circumstances.
How far could rates rise if INSEE’s forecasts come true? Around 6.5% for LEPwhose calculation formula is designed to align with half-yearly inflation. The Livret A, it should be closer to 3%, or even more. Because it will also depend on the evolution of the ster interbank rate, another variable in the calculation formula. The latter has long been stuck in negative territory, around -0.58%. But the change in monetary policy by the ECB, which announced a rise in its key rates in July, should also push it up.