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Tuesday, February 7, 2023

Savings rate drops to 5.7%, lowest since 2008

Euro coins and Euro cents.

Euro coins and Euro cents.

The household savings rate stood at 5.7% of their disposable income in the third quarter of 2022, down 2.7 points from the previous quarter and the lowest in four years since the third quarter of 2018. The data was made public this Friday for the fifth consecutive month in December Announced a decline in inflation to 5.8%.

As published by the National Institute of Statistics (INE) this Friday, the rate – once seasonal and calendar effects have been eliminated, as savings typically decline in the first and third quarters, and in the second and Increases in the fourth – accumulates in four consecutive quarters of abstinence.

Without these seasonal adjustments, the household savings rate entered negative territory with -3.2% of their disposable income, compared to 6.4% in the same quarter last year, according to the institutional sectors’ quarterly non-financial accounts. .

Since it reached its highest level in the second quarter of 2020 with 25.1% in full home confinement, the savings rate has maintained a downward trend with some modest recovery.

Detailing by items, the gross disposable income of households was 186,600 million euros between July and September this year, up 1.6%.
To counter this, the final consumption expenditure of households is estimated at 192,034 million, a growth of 12%, as compared to 11,699 million saved in the same period a year ago, being negative (5,986 million).

Thus, and without these seasonal adjustments, the household savings rate is -3.2% of their disposable income.

Biggest need for funding in 15 years

On the other hand, domestic investment reached 12,901 million in the third quarter, down 2.9% compared to the same period in 2021.

Thus, and once the balance of capital transfers in the sector is taken into account, households registered a financing requirement of ₹19,453 million as compared to ₹954 million in the corresponding quarter of 2021. This is the highest in the third quarter in 15 years, since 2007.

The figures also provided data on non-financial companies, which accumulated financing capacity of 6,524 million euros, compared with 680 million a year earlier.

On the other hand, the financing capacity of public administrations was 8,517 million, up from 550 million in the third quarter of 2021. Overall, the financing capacity of the national economy was 5,816 million euros, compared to the rest of the world. 7,483 million in the third quarter of 2022 (1.8% of GDP) compared to 7,483 million in the same period of 2021 (2.5% of GDP).

With respect to gross national income, it reached 329,525 million in the third quarter of 2022, compared to 325,029 million in the same period a year ago.

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World Nation News Desk
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