The Livret A rate will not move on August 1 despite inflation. It will even remain blocked at 3% until January 2025. A decision by the government which made several MoneyVox readers react.
It is the favorite savings product of the French. The Livret A, held by 4 out of 5 French people, has seen its remuneration multiply by six since January 2022. It went from 0.5%, its floor level, to 3% on February 1, 2023. But surprise, this one does not will not move until February 2025 when is normally reassessed every six months. This was announced Thursday Bruno Le Maire, the Minister of the Economy.
A decision that aroused many reactions among MoneyVox readers. Indeed, the calculation formula which integrates the evolution of the average inflation excluding tobacco over the last six months and the half-yearly average of the €ster, an interbank reference rate, indicated a Livret A rate of 4 .1% from August 1st.
Livret A, LEP, LDDS… Here are the official rates as of August 1, 2023
Despite inflation, the Livret A rate blocked
But despite the rise in prices which is still sharp: 4.5% over one year in June, according to INSEE, the executive has decided not to move the remuneration of the Livret A. The calculation formula which is not applied, once again, gave 4.1% per year, and not 3%. ASHAMED », reacts Daniel2.
A higher rate, justified Bruno Le Maire, would have increased “the cost of credit for SMEs, which need to invest” as well as that of “credit for social housing”, i.e. “tens of thousands of social housing units” in less.
“As expected, this government has yielded once again to banking and other lobbies, which deprives us of a fair remuneration for savings which, at 4.1%, would have barely offset inflation. Too bad for the French: they will pay again and again for the decisions of those they have elected! », plague glt6investor.
Why life insurance jeopardizes the new rise in the Livret A rate on August 1
Billions of euros less interest
For an average Livret A filled with up to 5,800 euros, a rate of 3% will generate 174 euros in interest after one year. But with a rate of 4.1%, this Livret A could have brought in 237.8 euros. The shortfall is therefore 63.8 euros over one year. And it even reaches 252.5 euros for a Livret A with 22,950 euros on it, the maximum allowed. A difference far from being anecdotal.
Based on the 510 billion euros in outstandings at the end of 2022 for Livret A savings accounts, and for sustainable and solidarity-based development savings accounts (LDDS), the rate of which is equivalent to that of Livret A savings accounts, set the rate at 3% rather than at 4.1% deprives savers of 2.8 billion euros in interest over the next six months.
But this rate of 3% maintained for a year and a half, is however “good news” for savers, according to Bruno Le Maire because “it will give security, stability, visibility”.
SIMULATOR. Livret A: how many interests will you have at the end of 2023?
The usefulness of the calculation formula under debate
This Tuesday, the Governor of the Banque de France François Villeroy de Galhau defended Tuesday the maintenance of the rate of the Livret A at 3% over the next 18 months acted last Thursday, considering that it is ” a promise in favor of the saver”, according to him. “The current 3% is a little lower than the formula, it’s true”, but it should allow remuneration “significantly higher than inflation during the year 2024”, the Banque de France anticipating a decline in the inflation at 2.5% over the year 2024, then “around 2% by 2025”.
A delicate justification in times of high inflation. “3% instead of 4.1% on the Livret A and it’s presented as a good deal… So what is this hazy calculation formula for? asks Jean2.
Indeed, in theory since 2004, the Livret A rate is automatically revised, twice a year, on the basis of a mathematical formula. But in fact, it is often the executive, in conjunction with the Banque de France, which sets the remuneration of the Livret A. Hence the question recently asked by the MoneyVox editorial staff in this article: should the government to set the Livret A rate?