MNI BRIEF: Saving, Firm and Household Debts Down In 2022 - ECB

Euro area net saving dipped from EUR 668 billion in 2021 to EUR 626 billion in 2022, ECB figures show, with the household debt-to-income ratio falling from 95.8% to 93.1% over the same period.

A large dip in savings could reflect a drawdown to boost spending as the the cost-of-living soared, but it doesn't appear to have had a lasting impact on consumer sentiment as ECB chief economist Philip Lane pointed this week to a "visible improvement in the confidence of consumers and firms" over the first few months of 2023.

The debt-to-GDP ratio of non-financial corporations declined from 79.0% to 74.7%. The same firms' net lending rose from EUR 57 billion to EUR 75 billion, and that of that of financial corporations from EUR 61 billion to EUR 76 billion. EZ government's added almost EUR 60 billion in net debt, with central bankers continuing to warn both of the inflationary effects of loose fiscal policy and the build-up of financial stability risks as interest rates rise.