Lowest daily interest rates in over a decade, yet optimism persists
In recent months, German savers have experienced a decline in savings account interest rates due to the European Central Bank's (ECB) monetary policy decisions amid a cooling inflation environment and global economic uncertainties. Since February, interest rates have fallen from 1.56 to 1.17 percent, with particularly low rates at savings banks (0.39 percent) and cooperative banks (0.43 percent).
The decline in interest rates is primarily influenced by the ECB's lower key interest rates, inflation trends, global uncertainties, a strong euro, and lower energy prices. These factors have contributed to subdued inflation expectations, keeping base rates and thus bank savings rates lower.
As a result, most German banks, especially online ones, offer savings account rates in the low single digits or below 3%, with introductory offers at around 2.55% dropping to about 1.45% after promotional periods. However, six banks are again offering promotional interest rates of three percent or more, albeit for a limited time and often requiring additional products such as deposits or current accounts.
The average savings account interest rate for banks active nationwide is currently 1.17 percent. Economists expect the ECB to make only one more interest rate cut by the end of the year. This anticipation, combined with the revival of highly remunerated new customer offers, indicates that some banks are positioning for the end of the interest rate cutting phase.
In June, the decline in interest rates reached a new low in 13 years, with the strongest decline since the introduction of the ECB's negative interest rate policy in 2012. However, if the ECB pauses at their upcoming meeting, the situation in savings accounts could slightly ease.
Savers can find rates of up to four percent by comparing offers, according to analyses by Verivox. Some banks are now offering new customers interest rates of over three percent, and up to four percent in some cases. Whether the interest rate drought continues depends on the next move by the ECB.
In summary, savings account interest rates in Germany have declined due to the ECB’s easing of interest rates amid low inflation and economic uncertainties. A reversal toward higher rates might occur in late 2026 if inflation pressures return or economic conditions improve sufficiently to warrant tightening monetary policy. In the meantime, savvy savers can take advantage of the best offers available by comparing rates and taking advantage of promotional offers.
The decline in savings account interest rates in Germany, primarily influenced by the European Central Bank's (ECB) monetary policies, affects various aspects of banking and insurance, such as personal-finance and industry-finance. Consequently, most banks offer savings account rates in the low single digits, with some even offering promotional rates of three percent or more.
