The Central Bank and the main financial entities again adjusted the interest rates of fixed terms in pesos in a context in which changes in monetary policy generate concern.
The dynamics of fixed-term interest rates once again captured the attention of Argentine savers and investors. Several banks have decided to reduce the returns they offer on 30-day deposits, causing concern among savers seeking to protect their savings against inflation. The measure occurs in a context of changes in monetary policy in which banks adjust fundraising strategies.
The downward movement in rates responds to the decisions of the Central Bank of the Argentine Republic (BCRA)which adjusts its reference rate and modifies bank reserves. As the cost of money in the financial system falls, banks do not need to offer such high returns to attract deposits. In addition, the improvement in the liquidity of the system and the moderation in expectations helps banking entities to sustain the lowest rates.
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Why interest rates are falling on fixed-term deposits
The cut in interest rates on fixed terms is due to the change in the monetary policy of the BCRA, an entity that seeks to maintain control over the amount of pesos in circulation and accompany the inflationary deceleration. As reference rates are reduced, banks’ cost of financing becomes cheaper because they do not need to compete with high rates. Additionally, there is an improvement in the availability of liquidity, which decreases the need to offer high returns.
The Economic expectations also play a fundamental roleespecially with a high inflation showing signs of moderation. Banks assure that the real yield of fixed terms could stabilize.
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One, by one, the interest rates of each bank
Fixed terms continue to be a low-risk alternative for those seeking to preserve the value of your savings, although with increasingly moderate returns in the face of inflation and market developments. In this sense, these will be the online fixed term values of the main banks in Argentina, according to the Annual Nominal Rates (TNA) for October:
- Banco Nación: 37.5%
- Santander Bank: 35%
- Banco Galicia: 35.25%
- Banco Provincia de Buenos Aires: 34%
- BBVA Bank: 35.5%
- Macro Bank: 38%
- Credicoop Bank: 39%
- ICBC Bank: 35.15%
- City Bank: 31%
Source: Ambito
