No. 1031 - Many Too Many: excess savings and the transmission of macroeconomic shocks

Questioni di Economia e Finanza (Occasional papers)
by Andrea Foschi, Stefano Pica and Marianna Riggi
July 2026
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Since the second half of 2022, the household saving rate in the euro area has begun to rise again, reaching levels significantly higher than pre-COVID-19 pandemic trends would have predicted. This paper examines the implications of the accumulation of excess savings for the transmission of monetary policy shocks and inflationary shocks stemming from increases in energy commodity prices.

Accumulated households savings dampen the transmission of monetary policy to economic activity and inflation, while amplifying the impact of energy price shocks on consumer prices.

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  1. 21 July 2026
    No. 1031 - Many Too Many: excess savings and the transmission of macroeconomic shocks
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