Finally, the Livret A rate will drop on February 1. On Wednesday evening, Bruno Le Maire, the Minister of the Economy announced that his remuneration would drop from 0.75% to 0.50% net of tax. An unprecedented floor in the history of this very popular old investment, below which it cannot fall. In the process, the rates of the Livret Bleu and the Livret de développement durable et solidaire (LDDS) will also fall to 0.5%. The Livret A remuneration, which attracted more than 14 billion euros in savings between January and November 2019, had not changed since 2015.
The Minister of Economy therefore followed the recommendations of the Governor of the Bank of France, François Villeroy de Galhau, who said on Wednesday that he did not see “Reasons to deviate from the Livret A calculation formula”. In fact, inflation, which serves as the basis for calculating the new remuneration for this booklet with short-term interbank rates (-0.45%) accelerated at the end of the year, reaching 1.5% (1.2 % excluding tobacco). All the conditions are therefore met for a drop in the rate.
A measure that will benefit social housing
But the subject is politically sensitive. In this period of social conflict over pension reform and two months before the municipal elections, the government hesitated before deciding. The message sent is potentially negative and the approximately 55 million French people who hold a Livret A passbook may feel that their purchasing power is decreasing.
But in reality the drop in pay will be almost painless. “The amounts lost will be around 11 euros per year! And again, most of the Livret A books are empty: 40% of them contain less than 150 euros. Their holders will lose 20 cents a year! “, calculates Maxime Chipoy, managing director of MoneyVox.
The measure will fully benefit social housing. Caisse des Dépôts (CDC), which centralizes a large part of Livret A funds, uses the resource to finance land use planning, including the construction and renovation of social housing and investments in the local public sector. A decrease in the rate of the Livret A is synonymous with a decrease in the borrowing rates of low-cost housing operators. This should allow them to finance more new projects.