The French “Livret A” bank savings rate will double to 2%-Le Maire

PARIS (Reuters) – France’s Livret A bank savings rate – held by millions of customers across the country – will be raised from 1% to 2% in August, the second increase of the year amidst soaring inflation, French Finance minister Bruno Le Maire said Friday.

“Concerning the Livret A (…) we chose to act on the recommendations of the Governor of the Banque of France,” Le Maire told Le Parisien newspaper, adding the Livret A rate will reach its highest level in 10 years.

That rate had been raised from 0.5% to 1% at the start of the year. Last month, French inflation climbed further from the previous month to a record high of 6.5%.

The rate of another savings account, the People’s Savings Account (Livret d’Epargne Populaire, LEP), will be raised from the current 2.2% to 4.6%.

Contrary to the Livret A, access to that account is conditioned by people’s yearly earnings that must be below a certain threshold.

“The LEP is the most efficient investment to be shielded from inflation. But it is still little-known (…) That is why we will launch a new campaign,” Le Maire said, adding less than half of the 15 million French people eligible for opening such an account actually have one.

(Reporting by Benoit Van Overstraeten; Editing by Dominique Vidalon)