It is acquired: the rate of Livret A will increase on February 1, for the third time in a year. The magnitude of this increase remains to be seen. Here are the possible scenarios.
An increase, and even a significant increase in the Livret A rate: this is what Franois Villeroy de Galhau promised on Tuesday December 20 on RMC / BFM TV for February 1, 2023. But what does the Governor of the Bank mean? of France by significant increase? One thing seems certain: the future remuneration of the favorite booklet of the French will exceed 3%. Of how many? Everything will depend on the evolution, in the days to come, of the indices taken into account in the formula for calculating the rate of the Livret A, as provided for in the regulations. (1). They are two in number:
- the average of themonthly inflation excluding tobacco in the second half of 2022;
- the average of ster interbank rate in the second half of 2022.
Scenario n1: 3.30%
If we stopped the accounts today, the Livret A rate would rise on February 1 next from 2% 3.30% net. While it is not yet completely official, pending the final figures for December, average inflation excluding tobacco in the second half should, in fact, stop 6.217%.
As of December 20, the half-yearly average for the ster was 0.403%. This gives an average of 3.310% and therefore, under the rule of rounding to the nearest tenth of a point, a rate of 3.30%.
Scenario n2: 3.40%
However, the value of the 6-month ster taken into account by the Banque de France for the calculation will be that of December 31: the monetary institution has confirmed this to us. And it will increase again between now and then: the interbank rate used by banks for their day-to-day exchanges has risen sharply since the end of July, under the effect of increases in key rates decided by the European Central Bank to fight against inflation.
Result: if the 6 month ester reaches or exceeds 0.483% by the end of the year, which is very possible at the current rate, the result of the calculation formula would be changed, and the Livret A rate would increase 3.40% on February 1.
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Scenario n3: 3.50%
The Livret A rate, however, is not just a matter of arithmetic. The regulations allow the Governor of the Banque de France to do not apply the calculation formula and to propose to the Minister of the Economy to set the new rate, in two cases:
- in exceptional circumstances;
- when the application of the formula does not allow the overall purchasing power of savers to be preserved.
Are we currently in one of its scenarios? It’s all about appreciation, but we’re tempted to answer yes. When the Livret A rate is raised in February, inflation should have reached a peak of 7%according to projections made public by INSEE in mid-December.
In this context, the public authorities could be tempted to give a boost to the Livret A rate, to limit the gap with rising prices. For example by rounding it to the upper half point (3.50%), or even a little more. This is what happened already in February 2022: the rate was set at 1%, while the result of the calculation formula was 0.80%.
(1) Order of January 27, 2021 relating to interest rates for regulated savings products