The decline in consumption slowed down the fall in deposits in January

With a slight decrease compared to previous years, the traditionally declining household deposits in January closed. This is at a time when unemployment has risen, based on the relevant research of state employment agency OAED.

According to data released by the Bank of Greece, their balances amounted to 134.72 billion euros, down by only 425 million euros on a monthly basis.

In January 2020, before the outbreak of the pandemic, they had fallen by 880 million euros.

According to banking sources, an important role for this development was played by the reduction of consumption in the first month of 2022, which slowed down the decline of the relevant figures.

As the same circles explain, “retail traded in early 2022 at a lockdown rate, although there were virtually no restrictions on its operation.”

In particular, they argue that “consumers have reduced their spending due to rising energy costs, measures in food service and entertainment, but also the significant impact on their psychology due to the Omicron mutation, and the increase in cases.”

Turnover decline

It is characteristic, as they say, that “several sectors of the retail trade recorded a decrease in turnover compared to January 2021, when restrictions on economic activity were much more severe. “Even the supermarket sector has been declining at an annual rate of close to 10% last month.”

It is no coincidence that the deposits of non-financial corporations fell by 2.37 billion euros compared to 1.49 billion euros in the last January before the pandemic.

In part, the slowdown in the decline in individuals’ savings is due in part to mortgage disbursements made in January, after a seven-year record in new contracts signed at the end of 2021.

Turn to investment

On the other hand, the decline in time deposits balances continues at an accelerating pace.

Last month, they fell by 852 million euros. In 2021, respectively, the decline was of the order of 660 million euros and in 2020 420 million euros.

Part of this money was directed to alternative investments, as interest rates on time accounts are now virtually at 0%.

Indicative of this trend is the fact that the net inflows in the mutual fund market exceeded the period under review by EUR 102 million.