Indian Households May Have Marginal Propensity To Consume Less

State Bank of India's latest edition of Ecowrap has noted that many households may have marginal propensity to consume less because several types of spending are not easily available amid social distancing constraints. Analysing the trends in deposits since the lockdown was first imposed, on May 25, the bank noted that the data revealed that deposits (savings, current and term) increased significantly during Lockdown 1 as people were apprehensive in the beginning about spending, and turned frugal. During Lockdown 2, there was a 25% decline in bank deposits, but term deposit accrual was very healthy.

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