Deloitte: Savings are surging again, which will bolster economy

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Deloitte has done a good job quantifying the boom in household savings during the current lockdowns across NSW, Victoria and the ACT. Deloitte contends that the savings war chest will provide the economy with a strong consumption bounce once lockdowns end:

The latest data released by APRA indicates households are likely to have a hefty pool of savings to spend when restrictions ease. Once again, household deposits have jumped during the current lockdown, continuing a familiar story since the onset of the pandemic.

Last year, restrictions on movement and a collapse in confidence saw households rein in discretionary purchases. Added to that, generous government supports such as JobKeeper and the doubling of JobSeeker saw the incomes of some families rise. Combined, these factors lifted the household saving rate to a record high of 22% in June 2020.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.