Decrease in Deposit Rate for VTB Bank to Alleviate Significantly
Catch the Latest on the Savings Market: VTB's Forecast
Here's a lowdown on the latest happenings in the savings market, as per VTB's recent announcement.
Key Rate Stability
Good news for savers! VTB Deputy President Georgy Gorškov confirmed that the savings market will continue to be on a steady path. The key rate, as reported by VTB's press service, will hover around the 19-20% annual range in the short term, with further rate cuts expected, albeit at a slower pace than previously seen.
Market Stability Outlook
VTB's experts' predictions seem spot on, as the Central Bank has maintained the current key rate at 21% for the fourth month in a row. The influence of major pro-inflationary factors remains significant, meaning a decrease in the key rate is possible in the second half of the year. However, don't expect rapid rate cuts – the market may take a wait-and-see approach, assessing liquidity needs before making any moves.
Retail Deposit Market
The retail market, fondly labeled as the "time of depositors," is still going strong. Despite a slight decrease in maximum deposit rates, the overall ruble portfolio has grown by 400 billion rubles in March due to an increase in time deposits. On average, deposit rates have dropped by 0.6 p.p. in March, according to the CBR.
High Yields Ahead
With the market stabilizing in the 19-20% annual range, clients still have the opportunity to secure attractive yields on savings products. However, market participants may exercise caution, taking time to assess their needs before making investment decisions.
Retail Lending Market
Lending rates for individuals will remain at their current levels, with no immediate change in sight. Given the Bank of Russia's anticipated tight policy for most of 2025, we're not expecting a shift in trends anytime soon. This means mortgage rates will continue to surpass 25%, keeping demand at bay, while government programs will continue to dominate bank lending structures.
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- The key rate, as confirmed by VTB's Deputy President Georgy Gorškov, is predicted to stay around 19-20% annual rate in the short term, with gradual rate cuts expected later.
- The retail deposit market, often referred to as the "time of depositors," continues to thrive, with a 400 billion rubles increase in March due to a rise in time deposits.
- With the market settling around the 19-20% annual range, clients can still benefit from attractive yields on saving products, but may choose to exercise caution before making decisions.
- The lending rates for individuals are unlikely to change in the near future, given the Bank of Russia's anticipated tight policy for most of 2025, meaning mortgage rates will outperform 25%, maintaining demand suppression.
