Posted on Dec. 2021 at 15:00Updated 21 Dec. 2021 at 18:16
The era of over-saving seems well and truly over. For the third consecutive month, the collection of regulated savings was negative in November. According to figures from the Caisse des Dépôts published on Tuesday, the French withdrew 360 million euros from their Livret A and their Livret de Développement durable et solidaire (LDDS).
This new outflow could well mark a normalization of the savings behavior of the French, or even the end of the phenomenon of over-savings born with the health crisis. This is all the more true as this decline in outstanding Livret A and LDDS occurs despite the strength of the fifth wave and the arrival of the sixth linked to the Omicron variant.
Last year, during the same month of November, the French had placed more than 3 billion euros in these accounts remunerated at 0.5%. They had then just entered the second confinement linked to the Covid-19 epidemic, de facto reducing their consumption and leading them to achieve “forced savings”.
In fact, it was in September that the French began to withdraw more money than they put on their Livrets A or LDDS, after a year launched with a momentum almost equivalent to that of 2020. The outflow then reached 20 million euros, to widen to 3.4 billion euros in October.
Since the beginning of the year, the cumulative collection thus amounts to 20.28 billion euros, against 35.21 billion over the first eleven months of last year. The total outstandings of the two regulated savings products amounted to 468.6 billion euros.
The Banque de France is also counting on a normalization of savings behavior. Cumulatively over the first three quarters of 2021, it estimates the household financial savings surplus (difference between the observed financial savings flows and the flows that would have been obtained by prolonging the pre-Covid trend) at 169 billion d euros, after 114 billion euros at the end of 2020.
“Its rate of accumulation, however, tends to fade, since it only increased by 6 billion euros in the third quarter of 2021”, writes the institution in a note published last week.
However, the situation could be reversed. “For the next few months, the evolution of the Livret A may be affected by the resurgence of the epidemic, analyzes Philippe Crevel, director of the Cercle de l’Epargne. The drop in household morale could lead to a return of strong collections for the Livret A and all the more so if restrictive health measures were implemented. “
In addition, Bruno Le Maire’s announcement of an increase in the Livret A rate on February 1 could encourage the French to refill their account. Although no figures have been put forward, given the current level of inflation, the rate of return could automatically climb to 0.7 or even 1% from February.
Of course, the real return will remain negative if inflation is factored in, which reached 2.8% in November. But in the current low interest rate environment, it’s hard to find a safe savings product with such returns. “The Livret A rate financed by the government is quite simply unfair competition,” chokes a savings professional.
Still, the gains for savers will be limited. According to the Cercle de l’Epargne, if the rate were set at 1%, the gain over one year for a savings account of 5,000 euros would be 25 euros. For a ceiling booklet, ie 22,950 euros, the gain would be 114 euros.