The economic landscape has recently changed as a result of the de-escalation of interest rates, affecting both loans and deposits and forcing investors to seek other solutions.
The new ECB decision to reduce interest rates is expected to accelerate developments.
The “investment havens” that savers have used, now ensure only marginally positive returns up to – in the best case scenario -close to 2%, which is lower than current inflation.
As a result, more and more citizens try to find solutions that -at least- will protect their capital from inflation. However, prospective borrowers are also entering a state of alert, expecting the ECB’s interest rate cut to have a greater impact on the market.
Interest rates
The lower yields on bank deposits and Greek government bonds were reflected in the data recently announced. The yield on the 52-week bond fell to 2.15% from 2.27% in the previous issuance that took place on December 4.
Regarding deposits, the data from the Bank of Greece showed the following:
-The weighted average interest rate on new deposits remained unchanged at 0.45%.
-The average interest rates on overnight deposits from households and businesses remained unchanged at 0.03% and 0.16% respectively.
-The average interest rate on deposits with an agreed maturity of up to 1 year from households remained almost unchanged at 1.64%, while the corresponding interest rate on deposits from businesses decreased by 24 basis points to 2.32%.
