Household real disposable income down to 10.9%

According to data released by Eurostat the household saving rate decreased while the household investment rate remained almost unchanged in both the euro area and the EU27 during the third quarter of 2011 compared with the second quarter of 2011.

In the euro area, household disposable income fell by 0.4% in real terms, after a decrease of 0.1% in the previous quarter.

During the third quarter of 2011, the gross saving rate of households was 10.9% in the EU27, compared with 11.7% in the second quarter of 2011.

In the euro area, the household saving rate was 13.3% in the third quarter of 2011 compared with 13.7% in the previous quarter.

In the euro area, the drop in the household saving rate was due to a decrease in real gross disposable income (-0.4%), while real final consumption expenditure recorded a small increase ( 0.1%). Real income fell due to a decrease in nominal income (-0.1%) while prices rose ( 0.4%).

The slight decrease in household nominal disposable income (-0.1%) was the result of the negative contributions of net social benefits (-0.2 percentage point), taxes (-0.2 pp), and gross operating surplus / mixed income (-0.1 pp), while compensation of employees and net property income contributed positively ( 0.3 pp and 0.2 pp respectively).

In the EU27, the gross investment rate of households was 8.5% in the third quarter of 2011 compared with 8.4% in the previous quarter. In the euro area, the household investment rate was unchanged at 9.1% in the third quarter of 2011.

In the euro area, household investment (gross fixed capital formation, mostly in dwellings) grew ( 0.9%) while disposable income fell slightly (-0.1%).