Global | Coronavirus Watch: Three key questions on savings

Aside from the speed at which restrictions on activity will be eased in the next few months and the permanence of the rollback, the next greatest uncertainty is how household spending will respond in 2021.

One key “known unknown” is the speed at which households reduce the amount that they save and the extent to which they hoard or spend the substantial excess savings built-up in 2020. Whereas other commentators have
suggested a fast unwind could lead to a surge in inflation, we think the vast bulk of excess savings will not be spent quickly.

Topics: Coronavirus, Growth & secular trends, Financial risks, Lockdown