Indian household finances
Continuing from yesterday ( see here ). As per the latest data available from CSO, the demonetization appears to have a material impact on the financial savings of the Indian household. The composition of financial savings deployment has changed substantially in the period following demonetization. The currency in hands of people has seen a sharp jump mainly at the expense of bank deposits. Another interesting feature of the changes in household savings deployment is rise in private financial securities, e.g., shares & debentures of private companies and units of mutual funds. This component of household savings deployment has seen decent growth post FY16. This trend has in fact been much talked about in popular discourse. Three key take away from this trend are - (i) Most of the growth in this component may be coming from shift of bank deposits, confirming the trend that corporates are now increasingly seeking funds directly from publ...