2023-11-15 08:36:56
People had almost gotten used to the fact that interest rates were now only going up. Quickly when it comes to building interest, rather at a snail’s pace when it comes to savings interest – but still step by step. Now the first banks are reporting: They are reducing their interest rates for fixed-term deposits to one year in these autumn days. And building interest rates have also come down quite a bit from their peak.
The Swedish fintech Klarna, which is also an important player in Germany and collects a lot of savings money, now only pays 3.84 percent for fixed-term deposits for one year, instead of the previous 4.12 percent. 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 and based in Eschborn near Frankfurt, which is also often at the forefront of interest rate competition, is reducing its interest rate on fixed-term deposits with a term of 1.5 years from 4 to 3.85 percent. The Creditplus Bank in Stuttgart, which belongs to the French Crédit Agricole, is reducing fixed-term deposits from 3.8 to 3.7 percent per year. And the SWK Süd-West-Kreditbank in Mainz, which describes itself as “one of the leading direct banks in the areas of installment loans and fixed-term deposits”, has reduced its fixed-term deposit interest rates for 18 months from 4.2 to 4.05 percent.
Fixed deposit interest
in percent, investment amount 5000 euros, 12 month term
Grafik: thel., niro. / Those: Biallo
The consumer portal Biallo’s index for one-year fixed-term deposits has also fallen slightly – from 2.66 to 2.64 percent. In the past two weeks, ten interest rate increases for fixed-term deposits were offset by 15 interest rate reductions, according to Mario Hess from the Tagesgeldvergleich.net portal.
Building interest rates fell more significantly; from 4.22 to 4.07 percent for loans with a ten-year fixed interest rate.
Construction money
in percent, 10-year fixed interest rate
Grafik: thel., niro. / Those: Biallo
Mortgage rates have fallen since the end of October
Is this the new trend now? Max Herbst from FMH-Finanzberatung is still skeptical. There are still two opposing developments so far. While the so-called intermediary banks, some of them international banks that collect savings money via intermediary platforms, have actually 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 development for building money is clearer: mortgage interest rates have fallen across the board since the end of October.
The development of bank interest rates is also exciting because the European Central Bank (ECB) left its key interest rates unchanged in October – and there is speculation on the financial markets as to whether there could be interest rate cuts next year. The one-year period for fixed-term deposits could extend into phases for which at least some investors believe that interest rate cuts by the ECB are possible.
ECB President Christine Lagarde has firmly rejected such discussion as “premature”. However, there were other members of the ECB Governing Council who have at least already speculated about whether interest rate cuts would be possible next year if inflation falls significantly. The unexpectedly sharp decline in the inflation rate for the euro area in October to 2.9 percent apparently spurred such considerations.
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