French savings are about to experience a major turning point. Indeed, it will have escaped no one's notice that inflation is in sharp decline. Consequently, subject to a 3% freeze since the beginning of 2023, the Livret A rate should fall in February 2025. And, unfortunately, trends indicate that this isn't expected to be the only decline of the year. Explanations.
Reduced yield on Livret A, Livret d’Epargne Populaire (LEP) and other savings accounts
For all savers, the 3% yield on Livret A should soon be nothing more than a distant memory. Indeed, the European Central Bank (ECB) has once again announced its decision to lower its rates. It is therefore obvious that this decision will, in a few weeks, have direct consequences on Livret A.
For the record, freezing the rate of the Livret A and the Sustainable and Solidarity Development Booklet (LDD S) at 3% will end on January 31, 2025. In fact, the government has frozen the Livret A rate. And this, failing to revise it, as provided for in its calculation formula, which applies twice a year, in February and in august.
According to the final figures that INSEE published this Friday, December 15 inflation excluding tobacco stands at 1.1% year-on-year in November. This is, of course, good news for household purchasing power. But the least we can say is that this is not good news for the return on their savings.
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The new rates for their livrets, such as Livret A, depend, in fact, on the inflation rate over the six months preceding this revision. And this is a level that we have not seen for three years. What remains, in fact, a excellent news for household budgets. And this, after more than two years of historic inflation.
A drop to 2.5% in February 2025
Thus, the rate of Livret A could therefore fall to around 2.5% in February 2025. The LEP, whose rate has already fallen from 5% to 4% in August, could also see its remuneration drop to around 3.1%. And this, depending on macroeconomic developments.
And, according to MoneyVoxthis reduction should unfortunately not be the last in 2025. Indeed, the two macroeconomic indicators which are used to calculate the Livret A rate, inflation and short interbank rates are expected to continue to fall in the first half of 2025.
In its latest economic report, INSEE expects monthly inflation to stabilize at a low level. And this, between 0.7% and 1% year-on-year, from February.
Taking into account INSEE forecasts, the average price increase over the first half should be around 0.9%. Against 1.3% in the second half of 2024.
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Furthermore, the half-yearly average of the €ster interbank short rate is expected to continue to decline. This was lowered 4 times in 2024 (from 4.50% to 3.15%). And this trend could continue in the coming months. The €ster's half-yearly average could then fall to around 2.70% at the end of June 2025.
What will happen to the Livret A and the LDDS in August 2025?
Of course, at this stage these are only hypothetical forecasts. But if these trends were confirmed, the rate resulting from the calculation formula for Livret A (and LDD S) could rise to 1.8% in mid-2025. And that of LEP at 2.3%.
“The Banque de France will then have two options: either apply these new rates from August 1, 2025. Or deviate from the rule and choose, for example, to slow down the decline to 2% for the Livret A and 2.5% for the LEP”alert then MoneyVox.
