Why the first banks lower savings interest rates again

FPeople soon got used to the fact that interest rates kept going up. Quickly when it comes to earning interest, rather at a snail’s pace when it comes to savings interest, but still step by step. Now the first banks report: in these autumn days they reduce their interest rates for one-year fixed-term deposits. And construction interest rates have also dropped quite a bit from their peak.

Swedish fintech Klarna, which is also a major player in Germany and raises a lot of money from savings, now pays only 3.84 percent for fixed-term deposits for a year, instead of 4.12 percent previously. The company has also reduced the interest rate to less than 4 percent for terms of 18 and 24 months. Akbank, an institute with Turkish roots based in Eschborn near Frankfurt, which is also often at the forefront of interest rate competition, reduces its interest rate for fixed-term deposits with a term of 1.5 years from 4 to 3.85 percent. Creditplus bank in Stuttgart, which belongs to the French Crédit Agricole, is reducing fixed-term deposits from 3.8 to 3.7 percent annually. And SWK Süd-West-Kreditbank in Mainz, which describes itself as “one of the leading direct banks in the field of installment loans and fixed-term deposits”, has reduced its interest rates on deposits fixed term for 18 months from 4.2 to 4.05 percent.

Fixed deposit interest

in percentage, investment amount 5000 euros, term of 12 months

Graphics: thel., niro. / Source: Biallo

The consumer portal Biallo’s index for one-year fixed deposits has also fallen slightly: from 2.66 to 2.64 percent. In the last two weeks, ten interest rate increases for fixed-term deposits were offset by 15 interest rate reductions, reports Mario Hess of the Tagesgeldvergleich.net portal.

Construction interest rates fell more significantly; from 4.22 to 4.07 percent for ten-year fixed interest rate loans.

construction money

in percentage, 10-year fixed interest rate

Graphics: thel., niro. / Source: Biallo

Mortgage rates have fallen since the end of October

Is this the new trend now? Max Herbst of the WFH-Finanzberatung remains skeptical. So far there are still two opposing trends. While so-called intermediary banks, some of them international banks that collect savings money through intermediary platforms, have reduced their fixed deposit interest rates to some extent, many regional banks still have a lot of catching up to do. when it comes to savings. interest rates, and interest rate increases are also being observed. The evolution of money for construction is clearer: mortgage interest rates have fallen across the board since the end of October.

The development of bank interest rates is also interesting because the European Central Bank (ECB) left its official interest rates unchanged in October and there is speculation in financial markets about whether there could be interest rate cuts next year. The one-year period for fixed deposits could be extended to phases when at least some investors believe interest rate cuts by the ECB are possible.

The president of the ECB, Christine Lagarde, has firmly rejected this debate as “premature.” However, there were other members of the ECB Governing Council who have at least already speculated on whether interest rate cuts would be possible next year if inflation falls significantly. The unexpectedly sharp drop in the euro zone inflation rate in October to 2.9 percent apparently spurred such considerations.

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