Business investment rate falls to 18.8% in euro zone

Average income per household rose 0.7% in first quarter, according to Eurostat

Business profit share has remained almost stable as employee wages and social contributions, as well as taxes on production, remained steady. Photograph: Kai Pfaffenbach/Reuters
Business profit share has remained almost stable as employee wages and social contributions, as well as taxes on production, remained steady. Photograph: Kai Pfaffenbach/Reuters

The euro zone business investment rate dropped to 18.8 per cent in the first three months of this year, down from 19.5 per cent in the previous quarter, but profit share has remained almost stable, down from 37.8 per cent to 37.7 per cent.

Data published today by the European Union's statistics office Eurostat showed the investment rate in the EU27 area also fell, from 19.1 per cent to 18.3 per cent.

Eurostat has attributed the decline to a 3.4 per cent drop in investment in the euro zone, while gross value added remained unchanged.

Total stocks, including materials, supplies and finished goods, fell for the fourth quarter in a row.

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Business profit share dropped just 0.1 per cent to 37.7 per cent as employee wages and social contributions, as well as taxes on production, remained steady.

Household finances

Meanwhile, Eurostat data on euro zone household finances show average income per household rose by 0.7 per cent in the first quarter of the year.

In real terms, income per capita rose by 0.5 per cent, after a decrease of 1.1 per cent in the previous quarter.

The household savings rate increased 0.7 per cent to 13.1 per cent, but household investment was down 0.3 per cent to 8.4 per cent.

Calculations are based on seasonally adjusted quarterly accounts released by Eurostat and the European Central Bank.

Ciara Kenny

Ciara Kenny

Ciara Kenny, founding editor of Irish Times Abroad, a section for Irish-connected people around the world, is Editor of the Irish Times Magazine