Croatian citizens increase savings by 11 billion kuna

Croatian citizens increase savings by 11 billion kuna (Photo: Igor Soban/PIXSELL)

The pandemic is doing great damage to the economy. The state is giving subsidies to preserve jobs, caterers are protesting, transporters are demanding urgent meetings with the government, employers are asking for moratoriums on loans.

Economy Branko LozančićNov. 9, 2020, 5:39 p.m.

And then suddenly an announcement by the Croatian Chamber of Economy saying that Croatian citizens put more and more money in their bank accounts resounded like a bomb.

“The citizens of Croatia have increased their savings by  11 billion kuna. Croats continued to increase their savings in 2020, despite the crisis brought about by the coronavirus pandemic. Croatian National Bank data shows that household deposits with credit institutions in August 2020 reached the amount of almost 215 billion kuna, which is an increase of 5.4% compared to the same month last year, announced the Croatian Chamber of Economy.

How is that possible? Vedran Šošić, the Chief Economist of the Croatian National Bank, explained for the Studio 4 program where citizens get more money for savings and what this data tells us.

“We have different statistics. This is true, but you need to know what is behind it,” said Šošić. “It is,” he says, “about the inflow of deposits, a smaller number of households have a larger number of deposits.”

“The decline in consumption occurred in the second quarter, we see that personal consumption is recovering in both the EU and Croatia,” said Šošić.

The GDP is significantly lower than in the same period last year and what have suffered are investments, there are segments of the economy that have not recovered.

“It is expected that citizens save less when interest rates are lower and then deposits grow less, but this is also influenced by other factors such as fear of losing your job and it will all increase your savings and the amount of money you will deposit,” said Šošić.

Source: HRT