In the fourth quarter of 2008, in both the euro area and the EU27, the seasonally adjusted household saving rate increased, while the household investment rate decreased. In both zones, businesses recorded a fall in investment rates and in profit shares.

These data come from a detailed set of quarterly European sector accounts released by Eurostat, the Statistical Office of the European Communities, and the European Central Bank (ECB).

Household saving rates up in both zones

In the fourth quarter of 2008, the seasonally adjusted gross saving rate of households was 12.2% in the EU27, compared with 10.8% in the third quarter of 2008. In the euro area (EA15), the household saving rate was 15.1% in the fourth quarter of 2008, compared with 14.1% in the previous quarter.

In the euro area, the household saving rate increased, since final consumption expenditure fell more (-1.3%) than disposable income (-0.3%).

Household investment rates down in both zones

In the EU27, the gross investment rate of households was 8.9% in the fourth quarter of 2008, compared with 9.6% in the third quarter of 2008. In the euro area, the household investment rate was 9.9% in the fourth quarter of 2008, compared with 10.4% in the previous quarter.

In the euro area, gross fixed capital formation (investment, mostly in dwellings) fell more steeply (-5.3%) than disposable income (-0.3%). This led to a decrease in the household investment rate, extending the downward trend that started in 2007.

Business investment rates down in both zones

In the EU27, the gross investment rate of non-financial corporations was 22.8% in the fourth quarter of 2008, compared with 23.8% in the third quarter of 2008. In the euro area, the investment rate was 22.1% in the fourth quarter of 2008, compared with 23.8% in the previous quarter.

In the euro area, the decrease in the gross investment rate of non-financial corporations was due to gross fixed capital formation (investment) falling more steeply (-9.0%) than value added (-2.2%).

Business profit shares down in both zones

In the EU27, the gross profit share of non-financial corporations was 37.5% in the fourth quarter of 2008, compared with 38.0% in the third quarter of 2008. In the euro area, the profit share was 37.6% in the fourth quarter of 2008, compared with 38.7% in the previous quarter.

In the euro area the gross profit share of non-financial corporations decreased, since compensation of employees (wage costs) plus net taxes on production fell less (-0.6%) than value added (-2.2%).