Featured statistic: EUR 150 million

Date 9 November 2010

Since the middle of last year, Dutch households have purchased government bonds from peripheral euro countries, i.e. Portugal, Ireland, Italy, Greece and Spain, for a net amount of EUR 150 million. Consequently, by the end of the third quarter of 2010, households held EUR 155 million in government paper issued by this group of countries. In the second half of 2009, households started buying Irish government paper. Total purchases of this paper from mid-2009 until September 2010 amount to EUR 100 million. At the start of 2010, families moreover started buying debt securities issued by the Spanish, Greek and Italian governments for EUR 23 million, EUR 15 million and EUR 10 million, respectively. Hardly any Portuguese government paper was bought.

The problems related to these countries’ public finances have caused a sharp depreciation of the government paper, especially since the beginning of 2010. Dutch households most likely purchased these securities with an eye to future price gains and because of the high yields. The increased activity of households in these securities is remarkable considering the minor transactions in the period before mid-2009 (see Chart).

Incidentally, peripheral government paper only makes up a fraction of the investment portfolio of households. Total securities holdings in September amounted to EUR 88 billion. Of this, EUR 3.5 billion consisted of − mainly Dutch − government paper. The share of households in total peripheral euro countries’ outstanding government debt (approximately EUR 2,800 billion) is also very small.

Investments of Dutch households in government paper of peripheral euro countries