When you’re making an investment, meaning you’re thinking about putting your savings somewhere — especially since you’re going to have this double-digit inflation — you’re thinking about future returns. The problem is that the NBR’s forecasts for inflation in recent years “did not correspond” to reality. The central bank continued to make new assessments, but they should also be seen as such, even if now they have hired an astrologer – Minerva (just kidding).

*This text is not an investment recommendation, but rather a presentation of low-risk proposals.

*For bank offers, we used Finzoom.ro and Conso.ro calculators

* Interests are not capitalized (because we don’t know what will happen to the names Fidelis and Tezaur)

* Fidelis and Tezaur from September debut on Thursday

So, if we want to invest money somewhere this month (September 2022), we focus on the inflation forecast for the third quarter of 2023, which is 8.9%. Whether it will be so or not, life will show.

So in theory we should think we should have growth above 8.9%.

Now, if we look at the applications, neither the banks (except one) nor the government through government bonds are applying. The difference is that with banks that offer very little, fees and income tax drop you below projected inflation.

Let’s say a person has 5,000 lei and wants to save it somewhere for a short term, 1-3 years or 1,000 euros (given a fairly good exchange rate, the lei is artificially overvalued if we look at the deficit and more of the trade balance). Whether it costs euros or dollars depends on the individual. Any investment book says it’s good to keep your eggs in multiple baskets.

Investments for 1 year in lei

The best offers for bank deposits are 6.25% – 9% for annual offers in lei. This means that for 5,000 lei invested, the profit is 304 – 405 lei (after paying commissions and income tax).

In Tezaur (government securities that can be purchased through the Treasury, Romanian Post or online SPV), the government offers 7.75%, resulting in a profit of 387.5 lei on this investment.

Fidelis does not have an offer for 1 year in lei. We will talk about the euro below.

To overcome the projected inflation, you need to earn more than 445 lei.

Investments for 2 years in lei

Banks offer interest rates of 7.5-9.6% per annum (we mean the best offers – there are also weaker ones, probably some banks have excess liquidity). This would mean a profit after two years of 620 – 864 lei (after taxes and commissions).

Tezaur’s interest rate is 7.9% per year, which means a profit of 790 lei.

The NBR’s current forecast only covers the end of the second quarter of 2024, and it shows inflation at 2.3%. Let’s see what happens by then.

Placement of money for 3 years

If we are talking about a 3-year offer, the best interest rates in banks are 7.5-9.8% per year, which means a profit of 1012-1323 lei (after commissions and taxes).

Tezaur doesn’t have a 3 year offer, only 1 and 2 years, but there are Fidelis – titles that can be purchased through multiple banks or directly from a broker account. So, at Fidelis, the interest rate is 8%/year, which means a profit of 400 lei/year, i.e. 1200 lei for the entire period.

Savings in euros: what are the offers

As for saving in European currency, especially now that the exchange rate is good, it might be worth taking interest on the side. The problem is that banks offer very low interest for 1 year, for example 0.1 – 0.15% (others have 0.01 – 0.05%). Maybe not even worth mentioning.

Instead, with Fidelis for 1 year, the government offers an interest rate of 1.85%. 1000 euros invested leads to a profit of 18.5 euros.

There is also a 2-year Fidelis issue that has an interest rate of 2.65%/year, so for this invested amount of €53 after two years, that is €26.5/year.

If we’re still on the subject of publicly traded government bonds, it might be worth mentioning that there are deals from previous government issues that are trading just below the listing level that are worth keeping an eye on, especially since it’s possible because in some cases it’s worth buying them instead of new ones (as Hotnews.ro also showed in the August article about discounted titles – note that some prices have changed).

We don’t know what inflation will be, no one knows, not even the Central Bank, but everyone should think that if the money is in a current account (that is, not even in a deposit), it depreciates before our eyes. price increase Higher risk takers can try investing in stocks or corporate bonds directly in the stock market or using mutual funds. There are also low-risk investment funds. Be that as it may, but before such a step, it is good to study the topic: Do not jump into the water without knowing how to swim!

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