According to DZ Bank, the financial assets of private households in Germany should exceed the eight trillion euro mark in 2022.
(Photo: imago images/Kirchner Media)
Frankfurt According to a projection by DZ Bank, the financial assets of private households in Germany are likely to grow less strongly this year than in previous years. Nevertheless, DZ economist Michael Stappel expects that the mark of eight trillion euros will be exceeded.
In the past two years, high savings by citizens and rising stock prices have resulted in an increase in private financial assets of 6.7 percent and 8.4 percent, respectively, within a year. “This year, wealth accumulation is likely to slow down noticeably by just 2.3 percent,” according to the DZ analysis.
Among other things, price corrections on the stock markets as a result of the Russian war against Ukraine are responsible. There are also problems in the supply chains of industry and the expected turnaround in interest rates.
The savings rate, which had skyrocketed during the pandemic, will also return to normal – albeit not to the extent that was expected at the beginning of the year, predicts Stappel. “Without the Ukraine war, the end of the corona restrictions from this spring would probably have led to a revival in consumption, and the savings rate would have fallen well below its long-term average. The savings rate in 2022 and 2023 is likely to level off at around ten percent, close to the average level.”
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This means that private households put another ten euros aside for every 100 euros of disposable income. In 2020, the rate reached a record at 16.1 percent of disposable income and remained at a comparatively high level in 2021 at 15 percent.
Excess money often stays in the checking account
Many people had held back from making purchases out of concern about short-time work or unemployment as a result of the pandemic. In addition, trips were canceled and temporary closures in retail and gastronomy slowed consumption.
According to calculations by DZ Bank, private households saved around 200 billion euros more than the long-term average in the past two years. Consumers often simply left excess money in their checking accounts.
Now consumption is caught up. At the same time, energy and food prices, some of which have risen sharply, are depressing the savings rate. In January, in a YouGov poll commissioned by Postbank, with reference to inflation, 22 percent of respondents said they could not save anything. Since then, inflation has continued to rise. In April, consumer prices were 7.4 percent higher than in the same month last year.
The BVR banking association recently stated that the trend towards more savings in the form of shares and funds came to an abrupt end with the war in Ukraine: “Moreover, rising inflation is affecting the ability of private households to save. Accordingly, the trend towards saving on securities is only likely to continue in a muted form in 2022.”
According to Bundesbank figures, the financial assets of private households in Germany in the fourth quarter of 2021 amounted to a record amount of around 7,618 billion euros. For 2021, DZ Bank, including non-profit organizations such as foundations and non-profit associations, will have financial assets of a good 7833 billion euros.
Cash and bank deposits, securities such as shares and funds as well as claims against insurance companies are taken into account both at the Bundesbank and in the evaluation of DZ Bank. Neither DZ Bank nor the Bundesbank provide information on the distribution of assets.
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