Households and non-financial corporations in the euro area: second quarter of 2023

5 October 2023

• Households’ financial investment increased at lower annual rate of 2.1% in second quarter of 2023, after 2.4% in previous quarter
• Non-financial corporations’ financing grew at lower annual rate of 0.9%, after 1.4%
• Non-financial corporations’ gross operating surplus increased at lower annual rate of 5.3%, after 9.4%

Data for household financing and financial and non-financial investment

Data for NFC gross-operating surplus, non-financial investment and financing

Households

Household gross disposable income increased in the second quarter of 2023 at a lower annual rate of 8.1% (after 9.1% in the first quarter of 2023), as the main components increased at lower rates: compensation of employees grew at a rate of 7.1% (after 7.4%), and gross operating surplus and mixed income of the self-employed grew at a rate of 6.9% (after 8.7%). Household consumption expenditure increased at a lower rate of 6.6%, after 9.7%.

Household gross saving rate in the second quarter of 2023 increased to 13.7%, compared with 13.4% in the previous quarter.

Household gross non-financial investment (which refers mainly to housing) increased at a lower annual rate of 2.5%, after 7.0% in the previous quarter. Loans to households, the main component of household financing, increased at a lower rate of 1.8% (after 2.9%).

Household financial investment increased at a lower annual rate of 2.1% in the second quarter of 2023, after 2.4% in the previous quarter. Among its components, currency and deposits grew at a lower rate of 1.6% (after 2.3%), while investment in debt securities grew at a higher rate of 56.8% (after 44.6%). Investments in shares and other equity as well as in life insurance grew at lower rates (1.3% after 1.5%, and 0.5% after 0.8% respectively). Investments in pension schemes grew at an unchanged rate (2.2%).

Household net worth increased at an annual rate of 4.3% in the second quarter of 2023, after 2.7% in the previous quarter. The acceleration was mainly due to valuation gains on financial assets, while housing wealth, the main component of non-financial assets, grew at a lower rate of 4.4%, after 5.5%. The household debt-to-income ratio decreased to 89.5% in the second quarter of 2023 from 95.0% in the second quarter of 2022.

Non-financial corporations

Net value added by NFCs increased at a lower annual rate of 7.1% in the second quarter of 2023, after 10.0% in the previous quarter. Gross operating surplus grew, at a lower rate of 5.3% after 9.4%, while net property income (defined in this context as property income receivable minus interest and rent payable) decreased, at a lower rate (-6.0% after -20.4%). As a result gross entrepreneurial income (broadly equivalent to cash flow) increased at a lower rate of 2.3% (after 6.1%).^[1]

NFCs’ gross non-financial investment increased at an annual rate of 17.3%, compared to a negative rate (-1.7%) in the previous quarter. This acceleration was due to a higher growth rate of the net acquisition of other non-financial assets, such as non-produced assets, while gross-fixed capital formation decelerated (6.5%, after 11.3%).^[2] NFCs’ financial investment grew at a lower annual rate of 1.7%, after 2.4% in the previous quarter. NFCs reduced currency and deposits (-1.1%, after 0.8%), and decelerated loans granted (3.0% after 3.4%) as well investments in shares and other equity (0.8% after 1.3%). Finally, investment in debt securities grew at a lower rate (23.7%, after 24.2%).

Financing of NFCs increased at a lower annual rate of 0.9% (after 1.4%), reflecting lower growth rates of financing via loans (2.4%, after 3.4%), shares and other equity (0.0%, after 0.5%) and trade credits (1.8%, after 2.9%), while financing via debt securities grew (0.7%, after 0.0%). NFCs’ debt-to-GDP ratio (consolidated measure) decreased to 69.2% in the second quarter of 2023, from 73.8% in the same quarter of the previous year; the non-consolidated, wider debt measure decreased to 129.0% from 136.6%.

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Notes

• This statistical release incorporates revisions to the data since the first quarter of 2019.
• The annual growth rate of non-financial transactions and of outstanding assets and liabilities (stocks) is calculated as the percentage change between the value for a given quarter and that value recorded four quarters earlier. The annual growth rates used for financial transactions refer to the total value of transactions during the year in relation to the outstanding stock a year before.
• The euro area and national financial accounts data of non-financial corporations and households are available in an interactive dashboard.
• Hyperlinks in the main body of the statistical release are dynamic. The data they lead to may therefore change with subsequent data releases as a result of revisions. Figures shown in annex tables are a snapshot of the data as at the time of the current release.