Financial savings rise

Mutual funds benefit from change in household behaviour

There has been a welcome shift in the composition of household savings in the financial year of 2014-15. Individuals are investing in financial assets again, after a five-year period when the favoured inflation hedges were physical assets such as gold and real estate. The RBI's latest Annual Report says that the financial savings of Indian households rose to about 7.5 per cent of national income in 2014-15 from 7.3 per cent in 2013-14. At the same time, real estate and gold are both believed to have declined as a percentage of household savings. This shift may have been induced by the ...