No. 1046 - Explaining the recent dynamics of the saving rate in the euro area: evidence from the Consumer Expectations Survey

Questioni di Economia e Finanza (Occasional papers)
by Guido Bulligan and Paolo Farroni
July 2026
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Using data from the European Central Bank's Consumer Expectations Survey, this paper examines the impact of uncertainty on household consumption and saving decisions in the euro area in the post-pandemic period. Furthermore, it explores heterogeneity by income and liquidity constraints, and evaluates the role of aggregate uncertainty at country level in the predictive performance of macroeconomic models.

Household income uncertainty rose during the 2022-23 energy crisis and again in 2025-26 following the escalation of geopolitical tensions. Increased uncertainty is associated with higher precautionary savings, lower consumption and higher inflation expectations, especially when households perceive greater downside risks to their income. These effects are more marked for low-income and liquidity-constrained households.

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  1. 28 July 2026
    No. 1046 - Explaining the recent dynamics of the saving rate in the euro area: evidence from the Consumer Expectations Survey
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