CaixaBank Research | The Spanish economy has spent four consecutive years growing above the Eurozone average. At the same time, the savings rate has fallen to historic lows. Although this would seem to suggest that households have limited room to manoeuvre in their consumption decisions if the economic context worsens, in this article we see that it is still too soon to draw this conclusion.
It is likely that the savings rate will begin to recover slightly in the next three quarters and, in addition, households´ financial situation has improved significantly compared to the years before the crisis.
W forecast that household incomes will continue to recover over the next few years and will grow around 4% between 2019 and 2021.
The savings rate can be expected to recover gradually although, if incomes grow less than forecast, as in the pessimistic scenario, savings could still fall slightly before beginning to recover.
What risks would a fall in the savings rate entail? To analyse this question, we should evaluate the financial situation of households: their sources of income and the uses they make of it. Households present a healthier financial balance than before the economic crisis. Thus, if in 2007 12% of total household income came from new credit, in the four quarters up to Q318 this figure was only 1%.