Cyprus Saving Rate to Reach 11% in 2025 Amid Broader EU Stabilisation, Commission Forecasts

The household saving rate in Cyprus is forecast to increase to 11% in 2025, according to the European Commission’s Spring 2025 Economic Forecast, up from 10% in 2024.

This marks a significant improvement from the 3.4% average during 2011–2015, signaling enhanced economic confidence and income stability among Cypriot households.

The forecast paints a varied picture across the EU. While Cyprus, Portugal (13.5%), and the Netherlands (15.8%) are projected to see increased saving, Greece and the UK are expected to decline. Greece is set to maintain a negative saving rate of -2.5%, and Bulgaria, though improving, will remain in the red at -3.2%, up from -4.9% in 2024.

Leading the bloc, Germany is expected to hold a robust 20% saving rate, just shy of its 2024 level of 20.1%. France is projected to stay flat at 17%, while the euro area average is predicted at 15.3%.

Countries like Austria (18%), Finland (10.7%), and Italy (11.8%) also reflect stability or modest growth. Central and Eastern Europe show upward trends: Hungary is forecast at 17.4%, Poland at 6.6%, and Romania at 12%.

Meanwhile, the UK is expected to see a drop to 9.8% from 10.2% in 2024, and the U.S. is projected to dip to 10%, after a peak of 11% in 2024.

The report, spanning data from 2006 to forecasts through 2026, underscores uneven patterns of consumer behavior. The Commission emphasised that household saving rates are a key economic signal, closely linked to consumer confidence, disposable income, and macroeconomic stability. It noted that while higher saving can indicate financial security, it can also reflect consumer caution, potentially slowing short-term economic growth.

By fLEXI tEAM