Bank deposits reached an all-time record in Portugal during the month of July, with families and companies channeling 13.7 billion euros into new time deposits. This unprecedented volume represents an increase of 1,130 million euros compared to June, with 95 percent of the amount placed by individuals concentrated in terms of up to one year. Non-financial companies also allocated 11,433 million euros to new deposits during the same period, with maturities of up to one year representing 99 percent of corporate operations.
The average interest rate practiced by the national financial system rose for the sixth consecutive month, settling at 1.59 percent, the highest value since April 2025. This growth represents an advance of 0.04 percentage points compared to the previous month. However, year-on-year inflation in the same period stood at 2.5 percent, meaning that real capital returns remain in unfavorable territory and that depositors continue to lose purchasing power by immobilizing their savings in traditional banking.
Portugal holds the fifth lowest interest rate across the entire euro area, where the average remuneration on new time deposits reached 2.14 percent in July. The differential of more than half a percentage point highlights the abundance of liquidity accumulated by national institutions, which without aggressive competitive pressure for resource mobilization and with credit demand subject to strict criteria, avoid substantial increases in the rates paid to depositors. Finland leads European savings appreciation at 2.58 percent, while Cyprus occupies the lowest position with just 1.26 percent.
The 28 percent taxation on capital income further reduces the expression of the interest earned, but the guarantee provided by the Deposit Guarantee Fund, which covers balances up to 100,000 euros per depositor, outweighs alternatives with greater potential returns. This risk aversion persists even when savers are aware that net remuneration does not provide protection against inflation, confirming that capital security remains a priority for national households.
