Fitch Ratings: Euro area household consumption set to increase in 2026

Fitch Ratings: Euro area household consumption set to increase in 2026

Fitch Ratings: Euro Area Household Consumption Set to Increase in 2026

Fitch Ratings has indicated that household consumption in the euro area is poised for continued recovery in 2026, despite ongoing global economic challenges such as inflationary pressures and geopolitical uncertainties according to Fitch Ratings. This outlook aligns with recent data from Eurostat, which shows modest but consistent growth in household real consumption per capita in the third quarter of 2025.

According to Eurostat, household real consumption per capita in the euro area rose by 0.4% in Q3 2025, following a 0.4% increase in Q2 2025. While growth remains moderate, the data suggest a stabilization in consumption trends after periods of volatility earlier in 2025. Household real income per capita also increased by 0.1% in Q3 2025, though this followed a stronger 0.5% rise in the prior quarter.

The saving rate in the euro area declined by 0.3 percentage points in Q3 2025 compared to the previous quarter, reflecting a gradual shift toward consumption over savings. This trend was observed across several member states, including Greece (-1.8 pp), Sweden (-1.4 pp), and Finland (-1.2 pp). Conversely, countries like Italy (+1.4 pp), Hungary (+1.1 pp), and Poland (+0.6 pp) reported increases in their saving rates.

Meanwhile, the household investment rate remained stable at 9.0% in the euro area during Q3 2025, with mixed performance across member states according to Eurostat data. Greece and Ireland saw notable increases in investment rates, while Italy recorded a decline.

Fitch's analysis underscores the resilience of eurozone households, supported by steady income growth and a gradual reduction in precautionary savings. However, risks remain, including potential revisions to inflation forecasts and the impact of tighter monetary policies on borrowing costs. Investors should monitor regional disparities, as consumption trends vary significantly among member states.

As 2026 progresses, the interplay between income growth, saving behavior, and external economic shocks will likely shape the trajectory of household consumption in the euro area.

(https://www.fitchratings.com/research/sovereigns/eurozone-household-consumption-to-continue-recovery-amid-global-economic-shocks-03-06-2025): Fitch Ratings, Eurozone Household Consumption to Continue Recovery... (March 2025)
(https://ec.europa.eu/eurostat/web/products-euro-indicators/w/2-28012026-ap): Eurostat, Household Real Consumption Per Capita Grows in Both the Euro... (April 2026)