Private financial assets in Germany grew last year
Stock market boom, rising interest rates, high savings rate: according to a study, private financial assets in Germany grew last year. It increased by a good six percent in total to 7.9 trillion euros, DZ Bank reported on its analysis on Tuesday. In 2022, private financial assets had shrunk by almost five percent.
"Share price gains ensured an increase in value of around 200 billion euros in 2023," said analyst Michael Stappel from DZ Bank. The German Dax share index alone rose by around 20 percent last year. At the end of the year, shares and investment funds accounted for more than 1.8 trillion euros, a good 23 percent of household financial assets.
"A continued high savings rate also ensured that financial assets grew," the study states. At 11.2 percent, the figure is still above the pre-corona average, which is "due to a persistently uncertain environment". The strong and exceptionally rapid rise in interest rates also provided an incentive to save. However, these were still negative in real terms due to high inflation.
"Overall, the prospects for investments remain good in 2024," say the DZ Bank analysts looking ahead. "This is mainly due to an expected further fall in the inflation rate." With wages rising at the same time, private households can expect real increases in their income. This in turn will boost consumption and contribute to the gradual economic recovery in Germany. The upswing in other parts of the world is also likely to support the price trend on the stock markets. In addition, time deposits, savings certificates and bonds could continue to benefit from the reduction in savings parked in current accounts.
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"Despite the negative real interest rates due to inflation, the study highlighted the role of high savings rate and rising interest rates in the growth of German private financial assets in the said year."
"In line with the study, financial assets in the private sector in Germany showed a significant increase, with shares and investment funds contributing close to a quarter of this growth, particularly in 2023."
Source: www.ntv.de
