The household saving rate falls to 14.8% in the second quarter

The savings rate of households and non-profit institutions stood at 14.8% of disposable income in the second quarter of the year, 1.6 points lower than the same period in 2016 and the lowest in a second quarter since 2008, according to the National Institute of Statistics (INE).

Households increased disposable income by 2.6% year-on-year in the second quarter to 195,352 million euros, but their consumption expenditure fell below this figure by 166.471 million euros, an increase of 4.6%. so that their savings were positive.

This stood, in particular, at 28,811 million euros, compared to 31,130 million euros in the second quarter of 2016, which means in relative terms a decrease of 7.5%.

To this is added that households spent between April and June 8,347 million euros, 10.1% more. Taking into account all of the above, the sector presented a financing capacity of 19,814 million euros in the second quarter, in contrast to the estimated 23,410 million euros for the same period of 2016.

The INE has also reported that the household savings rate in the last four quarters reached 6.5%, four tenths less than in the previous quarter and the lowest since the first quarter of 2008.

In the second quarter, the Spanish economy recorded a financing capacity of 5,867 million euros, 2% of GDP, compared to the financing capacity of 6,672 million euros in the same period of 2016 (2.4% of GDP).

Eliminating seasonal and calendar effects, the financing capacity of the Spanish economy stood at 1.7% of GDP, compared to 2.3% in the previous quarter.

The Spanish economy recorded capacity for financing in the second quarter thanks to households and financial institutions, which also showed financing capacity, in contrast to the need for financing registered by Public Administrations and non-financial corporations.

LOWER NEED OF FINANCING OF PAs

Specifically, the Public Administration recorded a financing requirement of € 20,341 million in the second quarter, below the funding requirement for the same period last year (€ 25,824 million).

This decline in the need for public sector financing came after a 12.5% ​​increase in disposable income to 40,456 million euros and an increase in its consumption expenditure by 0.4% the 55,765 million euros.

As a result, the sector recorded a gross saving of -15,309 million euros, compared to the negative savings of 19,611 million in the second quarter of 2016.

This result, together with the net balance of capital transfers and investments amounting to 5,492 million euros (-2.2%), led the Public Administrations to register a financing requirement of 20,341 million in the second quarter.

NON-FINANCIAL COMPANIES

Regarding non-financial corporations, their disposable income declined 1.3% in the second quarter, after being affected by the increase of 3.6% registered in the sector's primary income balance due to the evolution of Corporate Income Tax , contributions and social benefits and other current transfers.

The gross operating surplus of non-financial corporations grew by 5.6% over the second quarter of 2016. The sector's disposable income, together with its balance of capital transfers, was insufficient to finance the net investment volume of the sector ( 47,760 million euros, 8.6% more), so it recorded a financing requirement of 1,792 million euros, compared to the financing capacity of 3.506 million euros in the second quarter of 2016.

Finally, financial institutions had a financing capacity of 8,186 million euros, compared to 5,580 million in the second quarter of 2016.

This increase in the financing capacity of financial institutions was a consequence of higher disposable income, which rose by 17.6% to € 8,369 million, after increasing its gross operating surplus by 11.7% in the second quarter . At the same time, financial institutions made a divestment of 12 million euros in this period, in contrast to the investments of 1,266 million made in the second quarter of 2016.