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Irish households’ disposable incomes rose slightly in third quarter

New CSO figures show that the increase in disposable income, combined with only modest spending, increased general savings.

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THE TOTAL AMOUNT of disposable income held by Irish households rose slightly in the third quarter of 2012, compared to the second quarter, new data published today shows.

The CSO’s quarterly institutional accounts show that Irish households had a total of just over €23 billion in disposable income in the months July, August and September – slightly up on the €22.515 billion from the three previous months.

Consumption spending also increased, but by only a modest €64 million, to €19.319 billion – meaning the increase in disposable income contributed to a net increase in gross saving.

Households saved €3.684 billion in the third quarter, compared to €3.261 billion in the second – a rise of just under 13 per cent.

The CSO release also reveals that the government’s own savings deficit stood at €4.364 billion at the end of September, but that government net borrowing had fallen by over half within the space of a year.

While the government had borrowed €10.365 billion in the third quarter of 2011, largely in order to fund the recapitalisation of the banking sector, borrowings had fallen to €4.953 billion in the equivalent period in 2012.

The rest of the world borrowed a net total of €3.034 billion from Ireland in the third quarter, largely as a result of the increased household savings which made it easier for Irish banks and deposit institutions to lend to overseas partners.

Read: Saving index falls to record low with 48 per cent not saving at all

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