In 2022, 9% of households could not cover essential expenses with their total gross income, compared with 7% in 2020, given the observed growth in inflation and interest rates, according to the report published by the Bank of Spain on the financial situation of households and companies for the first half of 2023.
Although the nominal gross disposable income of households was 6.8% higher in 2022 than in 2020, inflation has led to an accumulated loss of purchasing power of 4.5% in that period, which has limited the saving and spending capacity of Spanish households.
The Bank of Spain explains that “The percentage of households in a particularly fragile situation, defined as those who cannot cover essential expenditure either with their income or with their sight deposits for more than one month, would rise from 3.4% to 4.1%. These percentages are substantially higher in the first income quintile, where households in this situation accounted for 14.6% in 2020 and would have risen to 17% in 2022.
