Last summer, in the second quarter of 2022, households in our country saved less than a quarter earlier. Their income increased, but the expenses even more. This is evident from figures from the National Bank. And that’s not a bad sign.
The National Bank calculated that families in our country put aside an average of 14 percent of their wages last summer. The so-called savings rate is therefore less than in the previous quarter, when it was still 15.6 percent. And that while disposable income within households nevertheless increased by 1.3 percent, mainly as a result of the rise in wages due to indexation. “Most people have clearly been well protected by wage indexation,” says Geert Sciot, spokesman for the National Bank. “For many, purchasing power has therefore not decreased.”
The fact that the savings ratio has fallen despite the increase in income is due to the fact that expenditure within households rose even more, by no less than 3.1 percent. “We see that people have started to spend more, including on festivals, travel, culture and catering. Things that were impossible or more difficult during the corona crisis. So we caught up, and that was necessary. Take travel now: that sector suffered heavily during Covid and has fortunately picked up again.” The sharp rise in energy prices and inflation also played a role in this.
Not a bad sign
The fact that we are saving less is not necessarily a bad sign, according to Sciot. “We expected that and even hoped for it. It means people are consuming more and pumping money into the economy. As a result, we still haven’t had a recession.” However, the savings rate is still above that before the corona crisis. “This may indicate that people continue to save slightly more due to the uncertainty they experience. But on the other hand, investments have remained the same for three quarters.”
However, the National Bank emphasizes that these are averages. “Not all families will experience it this way.”