In a context marked by the persistence of inflationary tensions, the Spanish economy reached a historical record in September 2024: 2.3 trillion euros, an increase of almost 12% compared to the same month of the previous year, as seen in the accounts. financial statements published this Thursday by the . The record, however, is explained by the incessant increase in prices and its cumulative effect, rather than by a real improvement in the economic capacity of families.
In 2022 and 2023, inflation hit the Spanish economy hard, with rates exceeding 10%. Although in 2024, the consequences of those years of skyrocketing prices are still present. A clear example is the financial assets of families and certain private institutions such as foundations linked to households (NPISH). In total, these resources grew by 8.6% compared to the previous year, reaching three billion euros.
The increase does not imply that the in real terms. An important part of this increase comes from the rise in the value of stocks and investment funds, whose price has been driven both by the dynamics of the markets and by the cumulative effect of inflation. In other words, although the number in bank accounts or investment portfolios is greater, that money does not have the same purchasing power as before the years of inflation crisis.
Furthermore, a change is observed in the composition of household financial assets. The weight of cash is at low levels and together with deposits, it barely accounts for 35% of families’ total assets. This decline suggests that households are looking for more profitable investment alternatives, possibly motivated by interest rates.
Another relevant aspect is the distribution of this financial wealth, since it is not uniform. Those households with greater investment capacity have been able to benefit more from the revaluation of assets, while sectors with fewer resources have limited themselves to defensive strategies, such as saving in deposits.
The debt, also at a minimum
Household debt has also decreased slightly, 0.3% compared to the third quarter of 2023. At first glance, this drop could be interpreted as a sign of improvement in the financial health of families. However, the context indicates that this slight reduction responds more to containment than to an increase in purchasing power. In fact, according to the document, net acquisitions in financial assets have fallen in absolute terms, that is, there has been a disinvestment.
In relative terms, that of GDP, compared to 47.2% the previous year, a figure that reflects not so much the solvency of families as the impact of economic growth on financial accounts. The rise in GDP by 0.8% during the third quarter of the year has allowed the ratio of debt to household wealth to decrease, in line with what has been happening since the health crisis.
This same logic explains that, although companies have registered an increase in their debt in absolute terms, it has actually decreased relative to GDP. Thus, the corporate debt ratio went from 67.2% to 64.8%. Overall, the consolidated debt of companies and households stood at 1.7 trillion euros, representing 109% of GDP, a decrease of five percentage points compared to the level recorded in September 2023. This trend reflects an improvement in the financial health of the Spanish economy, with a reduction in the debt burden in relation to total economic production.
You have to go back to 2001 to find another period in which the debt ratio was this low. At that time, Spain was experiencing an economic boom, the real estate bubble had not yet burst and household and business confidence in credit was high. However, after the 2008 crisis and subsequent economic difficulties, debt skyrocketed, becoming a significant burden on the national economy. In 2010, this ratio exceeded 200%, marking one of the most critical episodes for the country’s finances.
