According to an analysis, for the first time since summer 2023, savers will receive an average interest rate of less than three percent for fixed-term deposits with a longer term. Interest rates on overnight money are still stagnating.
The decline in savings interest on longer-term fixed-term deposits has accelerated since the beginning of the year. This emerges from an analysis by the comparison portal Verivox. Anyone who currently invests 10,000 euros for two years will receive an average of 2.99 percent interest from nationwide banks (deadline: February 7th). According to the information, it is the lowest level since July 2023. At the beginning of November, the evaluated institutions offered an average interest rate of 3.39 percent. In January it was 3.24 percent.
In anticipation of interest rate cuts by the European Central Bank, financial institutions are also offering less than three percent interest for fixed-term deposits that are invested for five years, with an average of 2.69 percent for the first time since July. According to the information, with a one-year term it is an average of 3.15 percent.
However, regional financial institutions continue to pay significantly less interest on average. Savings bank customers receive an average of 2.18 percent if they invest money there for two years. Savers at regional cooperative banks earn an average of 2.22 percent.
Daily interest rates stagnate
Savings are invested in a fixed-term deposit account for a specific period of time. Savers cannot access the money during this time, which is why the interest rates are usually higher than with overnight money. At the same time, financial institutions cannot adjust their conditions during the term. They therefore try to price in the expected interest rate developments in advance.
Many experts expect that the ECB could lower key interest rates in the common currency area again in the summer in view of the recent decline in inflation. This is likely to put further pressure on interest rates.
With daily money, which savers can access at any time, credit institutions can adapt their conditions to current market developments, in contrast to fixed-term deposits. Verivox is therefore not yet observing any falling interest rates across the board. There is currently an average of 1.72 percent at banks active nationwide. Since the beginning of December, overnight interest rates have stagnated.
In the medium term, Verivox also expects interest rates for overnight money to fall if the monetary authorities lower the key interest rates. “The cloudy interest rate environment will then also have an impact on overnight money,” expects Verivox expert Oliver Maier.
Verivox evaluated the daily and fixed-term deposit conditions of around 800 banks and savings banks.