Status quo for the booklet A. This Thursday, the Minister of Economy and Finance, Bruno Le Maire, announced the maintenance of the rate of remuneration at 3% on August 1. It will remain at this level until 2025, “for eighteen months”, in accordance with the recommendations of the Banque de France. And this, even if inflation slows down by then. A way to avoid a rise in the rate that some players feared, while offering guarantees to savers, who are very attached to this product.
The Minister of the Economy Bruno Le Maire thus validated the proposal of the Governor of the Banque de France, François Villeroy de Galhau to maintain the Livret A rate at 3% despite inflation, instead of applying the calculation formula which would have resulted in 4.1%. Indeed, the Livret A, revised twice a year in February and August, obeys a formula integrating the inflation of the last six months, and the short-term interbank rates.
A higher rate 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” less, he said. he argues on TF1. “The higher the passbook A rate, the more expensive the loans. I don’t want to jeopardize the construction of tens of thousands of homes or the development of thousands of small businesses.
In return, the government intends to maintain this remuneration until February 1, 2025. “I will maintain this rate even though inflation should be much lower and thus lower the Livret A rate” he continued. But above all, the government “produce a shock of attractiveness” on the People’s Savings Book, the rate of which is entirely calculated according to the evolution of consumer prices. The rate of this investment, accessible subject to income conditions (1774 euros per month for a single person), will be set at 6%, well above inflation which is 4.4% in June. “This rate should have dropped if we had applied the mathematical formula” added the Bercy tenant.
The ceiling of the LEP today of 7700 euros will also be raised to 10,000 euros. Indeed, one out of two holders of this investment is already at the ceiling. “The LEP is popular savings. It is a great success with 10 million holders. 8 million additional French people are entitled to it. I therefore invite all French people who can to open a LEP,” continued Bruno Le Maire.
For the authorities, three different scenarios could emerge. First, that, improbable, of a significant increase in the rate. According to the calculation formula provided by the Banque de France, this should have, according to the experts, been between 4% and 4.1%. But the authorities have the possibility of derogating from this formula in the event of circumstances deemed exceptional. This is not the first time that the government has not applied the Livret A formula. Already in February, taking inflation and market rates into account should have resulted in a remuneration of 3, 30%. Then, a “compromise at 3.5%” – the second hypothesis – had been considered, as Eric Dor, director of economic studies at IESEG on BFM Business, put forward this week. Finally, the last hypothesis evoked the non-increase of the interest rate of the livret A, which would therefore remain at 3%. Several players, such as the Caisse des dépôts et consignations (CDC), which manages 60% of the amounts deposited by the approximately 55 million French people holding a booklet A, and the Social Union for Habitat had pleaded for this solution.
Due to the return of inflation and the rise in interest rates, the Livret A rate has been raised many times in recent months. This rose from 0.5% to 1% in February 2022. This was the first increase in more than ten years. The remuneration was then once again raised to 2% on August 1, 2022 “due to inflation”, then to 3% on February 1. It was then at its highest since 2008. In recent years, the rise in the rate has caused the collection of the Livret A account to explode: households have thus deposited more than 2.5 billion euros there, in May and 24 alone. 5 billion euros in five months. The sustainable development and solidarity booklet, meanwhile, collected 7.87 billion euros over the same period. It remains to be seen how this Thursday’s announcement will affect this dynamic.
