A nation of involuntary savers won’t splurge their unexpected wealth

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Tomorrow we will get figures showing whether the economy shrank by 1.5 per cent in the first quarter of the year, as originally estimated. We will also get the first look at the saving ratio in the first three months of this year — and it will be a surprise if it is not another large number.

A surge in the saving ratio — gross savings as a percentage of household disposable income — has been one of the stories of the pandemic. It jumped to 25.9 per cent in the second quarter of last year, the first lockdown, four times its pre-pandemic level at the end of 2019 of 6.3 per cent. The ratio came down to 14.3 per cent in the third quarter

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