PARIS (Reuters) -France’s finance ministry said on Wednesday it was cutting the regulated interest rate on popular, tax-free savings accounts known as Livret A to 1.7% from 2.4 from August 1.
French savers had over 600 billion euros ($696.6 billion) in Livret A accounts and a similarly regulated LDDS accounts at the beginning of the year, according to the Caisse des Depots, a public sector finance body.
The finance ministry sets the rate on the accounts on recommendation from the central bank according to a formula based in part on inflation and short-term interest rates, aiming to give savers a slight real return over inflation.
The latest cut was widely expected in light of the decline in inflation over the last year.
($1 = 0.8613 euros)
(Reporting by Leigh Thomas, Editing by Dominique Vidalon)
