The French are more tingling than the cicadas: they save more than their European neighbors and, according to the government, they do not consume enough, a situation that weighs on economic growth and complicates the recovery of public finances.
The French savings rate, measured per insec in 18.8% in the first quarter, is at its maximum in 45 years, excluding the health crisis.
He “could give way to a consumption resumption,” a traditional pillar of French growth, the government estimated on Tuesday in the support of the presentation that accompanies the discourse of Prime Minister François Bayrou in the 2026 budget.
The recent increase in the savings rate is explained by several factors, analyzed to economists in the Banking of France.
First, savers more easily retain the interests obtained in their savings products in a high performance period, as was the case in recent years.
Retirees, whose pensions increased last year, greatly placed this additional income in savings products instead of consuming more.
If the budget year presented on Tuesday by Prime Minister François Bayrou is likely to decrease it, he says, however, it is difficult to measure its impact.
Less inflation …
Limit the performance of a consumer savings product, difficult to assume politically, may appear among government tools to carry the savings rate at least at its level before COVID-19, that is, less than 15%.
The president of Calle de l’Epargne Philippe Crevel, for example, saw Wednesday in the absence of an impulse to the brochure A rate, which will fall on August 1 from 3% to 1.7%, in the strict application of the calculation formula, a will of the government to recover consumption.
Eric Lombard’s services in Bercy refute it completely and underline that the resumption of consumption is more linked to the decrease in inflation, participating in the improvement of purchasing power.
Insee also points out that a lower consumption is mainly due to French budgetary problems. The arbitration in favor of savings only comes in the second explanation, given the desire to limit its environmental impact, a motivation, however, more frequent among rich, young and urban homes.
However, a brochure rate has less competitive, promotes competitive products, such as life insurance, for example, which has been full since the beginning of the year.
… and more investment
Bercy and the banker of France also presented more risky financial investments than regulated savings (brochure A, housing savings plan …), destined to financing commercial capital.
This is the case of certain units of accounts, investment media marketed in life insurance contracts, investment in the stock market or investment, which Bpifrance Public Bank seeks to democratize.
The “Finance Europe” investment label, launched in early June to finance European growth, must also promote this objective.
Insurers, who sell life insurance contracts, and banks, to whom regulated savings can be expensive, are powerful allies in this battle.
According to him, “it is suicidal to make a resurgence of growth by consumption because our external balance will especially unbalance,” through the purchase of imported goods.
“Today is the time to recreate growth through the creation of wealth and investment,” he added, “and there is space in France (…) through the mobilization of savings to investment.”
Source: BFM TV
