An open secret. The Livret A rate should have fallen this year, from 3% to 2.5%. This is the proposal that the governor of the Bank of France, François Villeroy de Galhau, will make to the Minister of Economy on Wednesday. “I will make my proposal, Mr. Minister, on the Livret A rate on January 15”declared the governor on Wednesday January 8 during his greetings, in the presence of the new tenant of Bercy Eric Lombard.
François Villeroy de Galhau is waiting for the final December inflation figure given this morning at 8:45 by the INSEE, the last essential component for the calculation of the new rate of the leading regulated savings product. He will then submit his proposal to the minister, who will make the final decision. Eminently political, it can always hold surprises. The calculation formula is still far from being applied systematically and has been the subject of frequent exceptions in recent years.
For his first financial year, Eric Lombard has prepared the ground and must be faithful to his word of January 6 on France Inter, approving a rate “around 2.5%”. The drop, from 3% in force for two years, is logical since it reflects the drop in inflation in recent months.
A first decline since 2020
This would be the first reduction since the beginning of 2020, when the rate went from 0.75% to 0.50%. We have to go back to the summer of 2013 to find such a significant drop, of half a point. Even with a less profitable Livret, “ savings are not only protected, but allow real wealth to grow”justify Eric Lombard last week.
But the prospect of a reduction in the Livret A rate is bad news for the 57 million holders of a Livret A. “little red book”. But it offers a breath of fresh air to the actors who pay it: the banking establishments and the Caisse des Dépôts (CDC), which Éric Lombard led until his appointment as minister at the end of December. The consequence of a rate cut “It is very important for us”underlined last Wednesday on BFM Business the interim general manager of the “Caisse” Olivier Sichel, “This will allow us to lower the loan rate of social owners.”
Livret A and LDDS grew by 17.5 billion euros between January and November 2024, reaching an outstanding amount of 582.3 billion euros, according to the latest data from the CDC. The proposal of the new rate of the Libretto di Risparmiu Populare (LEP), reserved for the most modest families, is also expected on Wednesday. It should go from 4% to 3%, except “increase”.
Life insurance in ambush
This expected fall will also be viewed favorably by insurers, who offer a competing savings product. Thus, life insurance had a strong end to the year: savers deposited 4 billion euros more in November than they withdrew, unheard of since July 2010. The first performance rates of the funds in euros announced for 2024 – 3.75% for Ampli mutual, 3.5% for Garance, both stable – the competition will last in 2025. But the first rates announced are often the best bidders on the market and do not reflect the performance that all insurers show you, however, advises the president of the specialized company Facts & Figures, Cyrille Chartier-Kastler In addition, the rates of funds in euros are including gross social and tax contributions, contrary to Book A.
