EU Household Saving Rates Slip as Consumer Spending Continues to Outpace Income Growth

Household real consumption per capita in the euro area rose by 0.4 per cent during the third quarter of 2025, maintaining the same pace of growth recorded in the previous quarter, according to data released by Eurostat.

Over the same three-month period, household real income per capita in the euro area increased by a more modest 0.1 per cent, following a stronger rise of 0.5 per cent in the second quarter of 2025.

Across the European Union as a whole, household real consumption per capita climbed by 0.5 per cent in the third quarter, matching the expansion seen in the preceding quarter. Meanwhile, real income per capita across the bloc grew by 0.2 per cent, slowing from the 0.7 per cent increase recorded in the second quarter.

Eurostat indicated that the growth in household real income during the quarter was largely driven by the positive contribution of compensation of employees and social transfers in kind. In contrast, current taxes and net social contributions represented the most significant drag on income levels in both the euro area and the wider European Union.

As spending growth continued to exceed income gains, the household saving rate fell by 0.3 percentage points in both regions compared with the previous quarter.

Among EU member states for which data were available, saving rates increased in eight countries, remained unchanged in one and declined in seven. Italy posted the largest rise in savings, up 1.4 percentage points, followed by Hungary with an increase of 1.1 percentage points and Poland with a gain of 0.6 percentage points.

The sharpest drop in savings was recorded in Greece, where the saving rate fell by 1.8 percentage points. Sweden and Finland also reported notable declines.

Despite movements in saving behaviour, the household investment rate remained unchanged in both the euro area and the European Union during the third quarter. Nine member states registered an increase in investment rates, three saw no change and four experienced a decrease.

Greece recorded the strongest growth in household investment, with an increase of 0.9 percentage points, while Ireland followed with a rise of 0.5 percentage points. Italy posted the largest decline in investment, with its rate falling by 0.3 percentage points over the quarter.

With regard to Cyprus, Eurostat noted that figures were not available for member states whose gross domestic product at current prices accounts for less than 1 per cent of total EU gross domestic product.

By fLEXI tEAM