Households became wealthier in 2023 despite economic situation, according to Bank of Spain

FAMILIES in Spain became over 9% wealthier last year despite high inflation and interest rates, according to a Bank of Spain study.

The conclusion is reached by measuring the difference between savings and debts accumulated by households, and that went up by 9.25% to reach a new total record of €2.1 trillion.

Household financial assets – cash, shares, deposits and rental securities – increased by 5.95% compared to a year earlier, to a total of €2.83 trillion.

In relation to gross domestic product (GDP), net financial assets accounted for 193.7% at the end of 2023, a ratio that is 4.8% lower than a year earlier, which is down to the growth of the Spanish economy.

The bulk of Spanish households’ financial assets were held in cash and deposits, which accounted for 38% of the total; followed by equity holdings (30%); mutual funds (15%); and insurance and pension funds (13%).

Holdings in investment funds were the component that increased their weight in households’ financial assets the most, 1.1% more compared to a year earlier; while the weight of cash and deposits fell the most, by 2.7%.

In the case of households, debt went from €703,600 million in December 2022 to €685,400 million at the end of 2023.

In terms of GDP, the household debt ratio declined to 46.9% in 2023, down from 52.3% a year earlier and the lowest since September 2001.

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