Very poor conditions of bank deposits is a situation about which a lot has been written and said. The current year does not look any better than the previous year in terms of profitability of investments and other deposits.
–
Quite the opposite – higher inflation combined with no increases in NBP interest rates may make the annual balance of investment income look even worse than before.
–
See also: Inflation is racing, the minister calms down. Is this the end of drastic increases?
—
Experts of the RynekPierwotny.pl portal point out, however, to another issue that has not yet been discussed in the industry media. We are talking about the growing popularity of deposits and savings accounts in foreign currencies.
–
You can see that some of our compatriots, discouraged by the low interest rate on “zloty” deposits, decided to exchange their savings, for example, for euro and dollars. It was probably about the sense of security of savings and the expected exchange rate profits.
–
During the pandemic, Poles became interested in the US dollar
The national media usually presents information on the value of bank deposits of Polish families without any currency breakdown. Therefore, it is worth checking the currency structure of savings kept on accounts and deposits.
–
—
The latest data from the Polish Financial Supervision Authority show that still around 88 percent. bank savings of households are kept in zloty. However, after comparing the results from the end of April 2019 and April 2021, we can see a downward trend in the share of savings in PLN.
–
The chart below suggests that already in the fall of 2019, the value of bank deposits (accounts and deposits) settled in currencies other than the euro and the zloty began to grow faster.
–
—
It can be assumed that it was mainly about the increased interest in deposits in the US dollar, which is the second most important foreign deposit currency of Poles after the euro.
–
The changes from the end of 2019 were not yet caused by a significant appreciation of the dollar against the zloty, because only the beginning of the COVID-19 pandemic brought such a periodic change.
–
After about a year (at the turn of 2020 and 2021), there was a decline in the interest in investing funds in foreign currencies other than the euro. On the other hand, the sum of “euro” deposits grew more steadily throughout the analyzed period, for which the chart presents data from the Polish Financial Supervision Authority.
–
The currency and deposit offer of banks does not encourage interest
It can be assumed that the popularity of deposits denominated in foreign currencies would have been greater were it not for the existence of two problems.
–
—
The first one is impossible to avoid. The point is that the profits related to the strengthening of the foreign currency against the zloty remain purely virtual until the savings are changed back to PLN.
–
The second problem is related to the limited offer of deposits and savings accounts in foreign currencies and their low interest rates. Holders of savings in euro, British pound or US dollar are also affected by low interest rates. The difference is that it is not about the decisions of the Monetary Policy Council, but about the moves of foreign central banks (ECB, FED, Bank of England).
–
An analysis of the current market offer shows that a person intending to deposit EUR 10,000 can count on an annual deposit interest rate of 0.01 percent. – 0.40 percent In the case of USD 10,000, the corresponding rates are at the level of 0.01 percent. – 0.50 percent
–
—
With such low interest rates, the prospect of losing interest related to early disbursement of funds (e.g. after a significant strengthening of the foreign currency) will not be a big problem.
–
–
Source:
—
