Deposit rates and inflation in the EU: real return

A deposit looks safe because the number on the account only goes up. But what matters is what the money buys. This article sets out where policy rates and inflation stood in October 2026 in the countries our readers live in, how tax on interest works, how the deposit guarantee works and what a negative real return is. It is the base for the pillar article, property or a bank deposit: which is more profitable.

All market figures below are reported values with a date. They move, so check the source before you rely on them. We could not confirm every figure on the official page itself, and we say so where it matters.

Where rates and inflation stood in October 2026

Euro area. The ECB deposit facility rate was reported at 2.00%, with the next monetary policy meeting on 28 and 29 October 2026. Eurostat's flash estimate of euro area annual inflation for September 2026 was reported at around 3.8%, up from about 3.2% in August, with energy prices the main driver. Official sources: ECB key interest rates and Eurostat HICP.

Poland. The NBP reference rate was reported at 3.75%, unchanged at the council meeting of 7 October 2026 and in place since 5 March 2026. GUS flash CPI for September 2026 was reported at 4.0% a year, the highest in about 15 months, driven by fuel. The average rate on new zloty household deposits was reported by the press, citing NBP data, at 2.94% in August 2026. Source: NBP and GUS.

Germany. Destatis reported flash inflation of 3.3% for September 2026, with core inflation of 2.4% (Destatis). We did not find a reliable average deposit rate for Germany and do not quote one.

Czechia. The Czech National Bank repo rate was reported at 3.75% after a 0.25 point rise in June 2026, held in August. We could not confirm the September decision. The Czech Statistical Office flash CPI for September 2026 was reported at 2.5% a year (CZSO).

Baltics. Media reports of Eurostat and national data put September 2026 inflation at about 6.4% in Estonia, 4.6% in Latvia and 6.7% in Lithuania. These countries use the euro, so the ECB rate applies; we did not find reliable average deposit rates and do not quote any.

The main point: in October 2026, reported inflation was above the reported average deposit rate in Poland, and above the euro-area policy rate. Individual bank offers differ from averages, so look at the rate you can really get.

Tax on interest

What you keep is the rate after tax. These are the rules as reported; confirm them with the tax office for your case.

• Poland. 19% tax on interest, withheld by the bank when interest is paid, so you normally do not declare it in the annual return.
• Germany. Abgeltungsteuer of 25%, plus the 5.5% solidarity surcharge on it (about 26.4% together), plus church tax for members. A saver's allowance of EUR 1,000 for a single person and EUR 2,000 for a couple, if you give the bank an exemption order, applies first.
• Czechia. A final withholding tax of 15% on interest, deducted by the bank.
• Baltics. Rules differ by country, and exemptions exist. One summary lists 20% for Estonia and Lithuania and a progressive scale in Latvia, but we could not confirm how deposit interest is treated in each. Check the national tax authority.
• If you live in one country and keep a deposit in another, the tax of your country of residence normally matters, and treaties apply. Ask an adviser.

Real return: the arithmetic

Real return is nominal return after tax, minus inflation. More exactly, divide the growth factor of the money by the growth factor of prices. The simple version is enough for orientation.

These are hypothetical illustrations with round numbers: a deposit paying 3.0% gross, and inflation as reported in September 2026 for each country.

• Poland: 3.0% less 19% tax is 2.43%. With inflation of 4.0%, the real return is about minus 1.5%. On EUR 100,000 (shown in euro for comparison) that is EUR 2,430 of interest, while prices rose by EUR 4,000; purchasing power fell by about EUR 1,500.
• Germany: 3.0% less about 26.4% tax is about 2.2% (before the saver's allowance). With inflation of 3.3% the real return is about minus 1.1%.
• Czechia: 3.0% less 15% tax is 2.55%. With inflation of 2.5%, the real return is about zero, plus 0.05%.

The rates here are assumptions, not offers. Your real return depends on the actual rate, the tax treatment and the inflation of the basket you buy.

What negative real return means

If the real return is negative, the balance grows, but each euro or zloty buys less than before. You are paying for the safety and liquidity of the deposit with purchasing power. That can be a reasonable price for a reserve or for money you need in a year. It is a poor price for money you will not touch for ten years. It does not mean that property automatically fixes the problem: property has costs, taxes and its own risk, which the other articles in the series explain.

Two cautions. Inflation changes: one year of high inflation says little about ten years. And your personal inflation, which includes rent, energy and food, differs from the headline figure.

The deposit guarantee

In the EU a deposit guarantee scheme covers deposits up to EUR 100,000 per person per bank. In Poland the scheme is run by the Bank Guarantee Fund (BFG). The limit applies per person and per bank, not per account, so large sums are often split between banks. Not every product is a deposit, so check whether yours is covered. Deposits in banks outside the EU follow local rules.

When a deposit is the right tool

• A reserve for emergencies and short-term needs.
• Money you will need within a few years, such as a down payment or tax bill.
• Money you cannot afford to see fall in value on paper.
• When you want no management and no time commitment.

FAQ

What is a real interest rate? The nominal rate after tax, minus inflation. It tells you how fast your purchasing power grows or shrinks.

Is the 19% Polish tax on interest the same for everyone? It is the general rate on interest, withheld by the bank. Some products and accounts are treated differently, so check your case.

Is EUR 100,000 per bank or per account? Per person per bank, adding all your covered deposits in that bank. Joint accounts are usually split between the holders.

Does a rising rate fix a negative real return? Only if the rate rises above inflation after tax. Banks often adjust deposit rates slowly, and tax applies in any case.

Where do I look for current figures? The ECB, NBP, Eurostat, national statistical offices and your bank's current offer. Do not rely on an article older than a few weeks.

How we help

We are a trilingual platform that finds properties and coordinates independent local lawyers and tax advisers. This text is informational and is not legal, tax or investment advice, and past performance does not guarantee future results. Rates, inflation and tax rules change; verify current figures with the sources named above and with a qualified adviser.