The savings culture has rebounded somewhat, even in an unattractive savings environment, according to the latest savings index from Nationwide UK (Ireland).
Brendan Synnott of Nationwide said people were putting away more money in the last year. "There was an improvement in the overall fundamentals of the economy in 2013 and people's attitudes to savings increased," he said. "The ability to save disappeared during the crisis, but the regular saver has re-entered the market with force as the ability to save bounced back. It's a good indicator for the economy overall," he stated. Mr Synnott said the changes to DIRT tax and other taxes affecting savings in the last Budget had a huge impact on attitudes to saving. "Since the budget, we've seen a significant fall in savings attitudes, but it's being compensated by the ability to save regularly."
Attitudes towards savings are at their highest in individuals over 50. "It's partly a generational thing but people under 50 have been saddled with debt which they've been struggling to get down to manageable levels. That's beginning to return to normal but we still have a way to go," Mr Synnott said. He agreed that the budget changes would continue to hit savings this year and the preference to spend was already beginning become apparent in the index. However, the ability to save should see a better savings environment overall and a return to better performance over 2014, he added.
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***Euro zone industrial production figures for November will also be published today. Industrial output fell sharply in October, raising concerns that the region's weak performance in the third quarter will continue into the final months of the year. On top of that, the currency bloc is stuck in a period of low inflation.