ECB reduction in the deposit rate: What does that mean for savers in Berlin?

ECB reduction in the deposit rate: What does that mean for savers in Berlin?

The reform of monetary policy: effects on the savers and the economy

The latest step of the European Central Bank (ECB) to reduce the deposit interest by 0.25 percentage points has triggered many discussions. However, this step was not unexpected, especially in view of the emerging economic challenges in Germany. The ECB must ensure that the price stability in the euro area is preserved, whereby the hope of a quick economic upswing plays a subordinate role.

Especially against the background of the current inflation situation, which was 2.2 percent in the euro area in August 2023 and only reached 1.9 percent in Germany, there is positive news. Nevertheless, core inflation remains a problem, since it is just under 3 percent above the target value. Another failure of the ECB, as after the beginning of the Ukraine crisis, when interest rates were raised too late, could have serious consequences for households and consumers.

The importance of this situation extends beyond the ECB, because the challenges in front of which the German economy faces are often homemade. A slight decline in interest rates could help at short notice, but it is essential that the savers become active. For many people, who are often little familiar with digital offers, it could be difficult to find the best options for creating their savings.

In addition, it is disappointing for long -term bank customers that many credit institutions, especially savings banks and cooperative banks, still do not offer interest on credit. This can particularly affect those who do not want to strive for a rapid opening of an online account or shy away from investing. But it is essential that savers do not put up with this zero interest policy if they strive for active asset management.

A large number of banks now offer attractive overnight money accounts that can be opened without an additional checking account. A change can often be advantageous without dissolving the existing account. In addition, it has never been easier to invest in the stock market. Anyone who is ready to find out about ETFs (Exchange Traded Funds) and think in the long term can benefit from higher returns that may exceed inflation.