Outlook for savings and financial investments, June 2024

Confirmation of the decline in the volume of portfolio adjustments in the first half of 2024

New savings inflows – which came to a total of €23.3bn in the first six months of 2024 – stood at their lowest level recorded since 2014, a level close to that observed in first-half 2023. The first half of the year, however, saw a sharp decline in the volume of asset reallocations vs. the same period in 2023. Aggregate withdrawals from sight deposits largely declined from a total of €23bn in 2023 to neutrality in 2024. The same trend was observed for withdrawals from taxed passbook savings accounts, which fell by 40%, while euro-denominated life insurance products enjoyed a significant recovery, with withdrawals declining from -€6.3bn to -€3.7bn in the space of a year. At the same time, inflows during the 6-month period held steady on unit-linked products although, in contrast, new deposits on term accounts fell from +€36bn to +€20.7bn and new deposits on tax-exempt passbook savings accounts declined from +€46.4bn to +€21bn.

Rebound in home purchase savings products

Home purchase savings products (home purchase savings accounts and plans) recorded a cumulative outflow of -€21.4bn in the first half of 2024, 24% higher than in 2023. However, after record outflows in December 2023 and January this year, the situation has improved almost every month since February. The January 2024 increase in the rate of interest paid on new home purchase savings plans (Plans Epargne Logement) from 2% to 2.25% probably helped to reduce the scale of portfolio adjustments at the end of 2023. In June 2024, the home purchase savings account (Compte Epargne Logement) recorded a timid inflow of +€0.03bn. The Plan Epargne Logement, however, continues to record seasonally-adjusted monthly outflows of nearly €3bn, at a pace similar to that observed in the third quarter of 2023.

Corporate cash flow: improvement and decline in the volume of portfolio adjustments

For businesses (or ‘non-financial companies’), the pace of portfolio adjustments has also declined substantially with outflows in the first half of 2024 (compared with the first half of 2023) falling from -€90bn to -€29bn for sight deposits and from -€4.5bn to -€0.05bn for passbook savings accounts, while net flows on term deposit accounts have fallen considerably from +€45bn to +€4.7bn. Overall, on a year-on-year basis, outstandings in banking products have stabilized after 18 months of negative flows. This improvement goes hand-in-hand with much more substantial flows into securities (+€34.5bn year-on-year in the first quarter of 2024, excluding listed equities) driven, in particular, by money-market mutual funds (+€21.2bn year-on-year in the first quarter of 2024), reflecting an apparent shift toward these vehicles of some of the portfolio adjustment decisions that previously favored term deposits.