Inflation erodes current accounts, 20 billion up in smoke in 2022 - Economy

Inflation and the cost of living reverse the saving trend of Italians and lead to an erosion of household current accounts. This is what emerges from a research by the Autonomous Italian Banking Federation (Fabi). After four years of steady increases, in 2022 the total balance of household current accounts decreased by almost 20 billion euro. From August to November there was, in fact, a drop of 18 billion from 1,177 billion to 1,159 billion, with a reduction of 1.5%. Already in June, compared to May, there was an initial decrease of 10 billion.

The conspicuous trend reversal in the accumulation capacity of current account holders, highlights the analysis by Fabi, comes after a long period of increase in bank deposit balances: at the end of 2017 the total amount was 967 billion, at the end of 2018 it was 990 billion (+23 billion), at the end of 2019 at 1,044 billion (+54 billion), at the end of 2020 at 1,110 billion (+66 billion) and at the end of 2021 at 1,144 billion (+34 billion).

If in the first seven months of 2022 the liquidity accumulated by households almost touched 1,180 billion euros, with growth – albeit slower than in the past – of 0.9% since the beginning of the year, the data for the following four months confirm the fears , by now ascertained, of a “collapse of purchasing power – highlights Fabi – which forces the Italians to draw on their reserves to face the higher costs”.

From July to November, total current accounts fell by almost 20 billion euros. The total value was 1,178 billion euros in July and 1,159 billion euros at the end of November, with a reduction of almost two percentage points (-1.53%) and which demonstrates that the price of the crisis is starting to be all in one’s pockets Italians.

With inflation and the cost of living the debts of Italian households also increased. In particular, it registers an increase in loans for consumption and the stability of personal loans. Overall, the amount of loans for both categories at the end of 2022 stood at 256 billion euros, up compared to January of the same year (+1.5%) and overcoming the constant increase trend since 2017, equal to ‘1.2%. The growth numbers in the world of finalized and non-finalized loans come as a “slap in the face of market conditions, because it is certainly not the low interest rates that are driving requests, but rather the growing propensity to pay purchases in installments , which makes the relationship that Italians have with the economy and savings contradictory”, highlights the analysis.