Market Information Monday 29 March 2021

Real disposable household income was 2.4% higher in 2020 in comparison to this time last year, according to Statistics Netherlands. Despite the Covid-19 crisis, disposable income has risen at a faster rate than in 2019. Disposable income rose mainly because employees earned more. Employee compensation increased by €15.4 billion (4.1%) to €393.4 billion. The number of jobs and hours worked fell, but government support measures meant that many workers continued to be paid their full wages. Figures published on Friday show that households saved approximately 23.3% of their disposable income in contrast to the 2019 savings rate of 16.6%.

The Bank of England has urged banks to keep providing credit to businesses once the government-backed Covid-19 loan schemes end this month. The BoE cautions as an abrupt fall in lending could choke the economy. In a report released on Friday, the central bank expressed that it was in the industry’s “collective interest” to prolong loans after government backed schemes are scaled back. UK businesses have borrowed more than £75bn through programs, which the Treasury launched during the first lockdown to prevent companies running out of cash.

New figures reported by Statistics Netherlands (CBS) show that the gross profit of non-financial companies amounted to €258.9 billion in 2020. This is €11.5 billion less than in 2019, a decrease of more than 4%. In the previous 3 years, gross profit had increased. The profit of foreign subsidiaries fell by a quarter in 2020, dragging down the overall figure. Operating profit of non-financial companies was higher than in 2019, partly due to corona-related subsidies.

The 6M Euribor increased with 1 basis point to -0.51% compared to previous business day. The 10Y Swap increased with 3 basis points to 0.02% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.