Euro Area Q4 2025 Economic & Financial Update

• Euro area net saving increased to €873 billion in 2025, compared with €867 billion in four quarter period ending on third quarter of 2025
• Household debt-to-income ratio decreased to 81.4% in 2025 from 81.7% one year earlier
• Non-financial corporations' debt-to-GDP ratio (consolidated measure) decreased to 65.8% in 2025 from 67.3% one year earlier

Total euro area economy

Euro area net saving increased to €873 billion (6.9% of euro area net disposable income) in 2025 compared with €867 billion in the four quarter period ending on the third quarter of 2025. Euro area net non-financial investment increased to €602 billion (4.8% of euro area net disposable income), due to increased investment by general government and households while net investments by financial corporations and non-financial corporations remained broadly stable (see Chart 1).

Euro area net lending to the rest of the world decreased to €301 billion (from €310 billion previously), as the increase in net non-financial investment more than offset the net saving increase. Households net lending decreased to €585 billion (4.6% of net disposable income) from €602 billion. Net lending of non-financial corporations (€62 billion, i.e. 0.5% of net disposable income) and that of financial corporations (€116 billion, i.e. 0.9% of net disposable income) were both broadly unchanged. General government net borrowing decreased (-€462 billion, i.e. ‑3.7% of net disposable income, after -€468 billion), contributing less negatively to euro area net lending.

Chart 1

Euro area saving, investment and net lending to the rest of the world

(EUR billions, four-quarter sums)

Data for euro area saving, investment and net lending to the rest of the world (Chart 1)

Financial transactions can be presented with a counterpart sector breakdown for deposits, loans, debt securities, listed shares and investment fund shares (see Table 1). In 2025 the largest aggregated transactions among these financial instruments were investments by other MFIs^[1]

with the rest of the world (€723 billion) and interbank operations - mainly deposits - between other MFIs (€652 billion). Main financial investment activities of households involved transactions vis-à-vis other MFIs (€286 billion), mostly in the form of deposits, as well as net purchases of investment fund shares (€214 billion). Non-financial corporations' largest financing component was from other MFIs (€153 billion), mostly in the form of loans, while financing from within the NFC sector amounted to €101 billion. General government financing from the Eurosystem, mostly in the form of debt securities, decreased (-€343 billion), while those from other MFIs (€391 billion) and from the rest of the world (€305 billion) both increased.

Table 1

Selected financial transactions* between sectors and with the rest of the world

(EUR billions, four-quarter sums, 2025)

Households

Household financial investment increased at a broadly unchanged rate of 2.6% in the fourth quarter of 2025. Among its components, investments in debt securities (3.1%, after 0.0%) and in life insurance (2.7%, after 2.3%) grew at higher rates, while investments in currency and deposits (3.0%, after 3.2%) and in shares and other equity (2.0%, after 2.6%) both increased at lower rates.

Households purchased, in net terms, debt securities, mainly those issued by general government, while selling debt securities issued by MFIs. Households were overall net sellers of listed shares, selling listed shares issued by non-financial corporations and MFIs, while buying listed shares of the rest of the world. Households continued to purchase euro area investment fund shares, both issued by MFIs (money market funds) and by non-money market investment funds (see Table 2 below and Table 2.2. in the Annex).