Household saving rates strengthened in 2023 after a sharp dip in 2022 caused by inflationary pressures. With slower price increases and solid employment, families rebuilt their saving capacity and increased spending while improving self-financing ability. Consequently, the household saving rate rose to 11.7 percent of gross disposable income in 2023, up from 7.6 percent in 2022. Although it remains below the 2021 level of 13.7 percent and the pandemic-year high of 17.4 percent in 2020, it stays above the 2019 figure of 8.19 percent.
According to the quarterly non-financial accounts statistics for institutional sectors published on Tuesday by the national statistics institute, households’ disposable income grew by 11 percent last year, reaching 923.56 billion euros. The rise was mainly driven by higher wages (8.8 percent) amid ongoing job growth and rising salaries, along with greater social benefits (9.9 percent) and property incomes (56.4 percent).
Households directed 813.066 billion euros to consumption, up 6.1 percent and 46.455 billion more than the previous year. Since gross disposable income grew faster than spending, saving surged by 70.6 percent, reaching 108.139 billion euros, 44.760 billion higher than in 2022. The amount saved is close to 2021’s 109.975 billion and only trails the exceptional 2020 level of 133.428 billion.
The national statistics reveal that households’ overall saving capacity was sufficient to fund their investment, totaling 64.539 billion euros (an 8.1 percent rise) in housing or financial assets, after nearly failing to do so in 2022 for the first time in a decade. As a result, households recorded a financing capacity of 42.361 billion euros, compared with only 2.5 billion in the prior year.
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In the corporate and financial sectors, enterprises reduced their operating surplus by 3.6 percent and their saving by 4.3 percent to 207.014 billion euros, yet they could finance their investments (which fell slightly by 0.7 percent) and still maintain an excess of 32.028 billion euros. Financial institutions, meanwhile, saw their operating surplus surge by 65 percent amid higher interest rates, but their saving declined by 14.5 percent to 38.276 billion euros. In any case, the combined saving enabled financing of investments and left a surplus of 32.783 billion euros.
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Businesses and banks
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INE data also show that the whole economy in Spain posted a financing capacity versus the rest of the world of 54.013 billion euros last year (3.7% of GDP), driven by surpluses from companies, banks, and households, which offset the public sector’s deficit. The public administration’s cumulative deficit over the twelve months of 2023 translated into a financing requirement of 53.159 billion euros.
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Looking at the corporate side, companies reduced their operating surplus by 3.6% and their savings by 4.3% to 207.014 billion euros, but they managed to fund investments, which dipped slightly by 0.7%, while still preserving an excess of 32.028 billion. The financial institutions, on the other hand, enjoyed a 65% jump in their operating surplus amid higher interest rates, yet their savings fell by 14.5% to 38.276 billion euros. Taken together, saving remained more than enough to finance investments and sustain a positive net surplus of 32.783 billion.