Current accounts, the deposit rate rises: here’s what’s changing

The rate on current account deposits only “has further risen to 0.56% (0.55% in the previous month), keeping in mind that the current account allows the use of a multitude of services and does not have the investment function”. This is highlighted by the monthly report of the Abi in April. Also last month the average rate on total deposits (certificates of deposit, savings deposits and current accounts), it was 1.03% (1.02% in the previous month, 0.32% in June 2022 following the decline in bond yields). of State, the rate charged on new fixed-term deposits (i.e. certificates of deposit and time deposits) in March 2024 was 3.54%.

TO February 2024 this rate in Italy was higher than the euro area average (Italy 3.65%; euro area 3.45%). Compared to June 2022, when the rate was 0.29% (last month before the ECB rate hikes), the increase was 325 basis points. The yield on new issues of fixed-rate bank bonds in March 2024 was 4.35%, an increase of 304 basis points compared to June 2022 when it was 1.31%. Meanwhile, the decline in rates applied by banks on new home mortgages continues. In March 2024, the April monthly report of the ABI highlights, the interest rates on new financing operations are decreasing: the average rate on new operations for the purchase of homes has decreased to 3.79%, compared to 3.89 % in February 2024 and compared to 4.42% in December 2023.

The average rate on new financing transactions to businesses fell to 5.26% from 5.34% in February 2024 and from 5.45% in December 2023. The average rate on total loans (therefore subscribed over the years) fell to 4.79% from 4, 80% in the previous month. As of March 2024, loans to businesses and households fell 2.6% from a year earlier, while in February 2024 they saw a decline of 2.5%, when loans to businesses fell 3.8% and those to families by 1.3%. This is what the ABI declared in its April report, underlining that “the decline in credit volumes is consistent with the slowdown in economic growth which contributes to depressing the demand for loans”.