Household savings at two-decade low

At 18.6% of GDP at current prices in FY17, down from a peak of 25.2% in FY10; financial savings at a 2-yr low of 7.8%

The household savings rate continues to decline and has touched a two-decade low in 2016-17. Household savings as a proportion of the gross domestic product (GDP) at current prices declined to 18.5 per cent in 2016-17, the lowest rate since 1997-98. 
 

The figure was 19.2 per cent in 2015-16, and 25.2 per cent at its peak in 2009-10.
 

Initially, the decline was led by physical savings – households’ savings in real estate and bullion – but financial savings are now showing strain. Household financial savings were down 10 basis points in 2016-17 to 7.8 per cent of the GDP against