Households’
financial savings have fallen from an average of 11
percent of GDP in 1999–2010 to only about 8 percent in
2011/12. A fall in broad money as a share of GDP (from
86.5 percent of GDP in 2009/10 to the level of about 83
percent of GDP in 2011/12 and 2012/13) corroborates a
decline in domestic financial savings. One clear
determinant of the drop in households’ savings is the
rise in inflation and inflation expectations, resulting in a
decline in real interest rates on households’ financial
savings. As CPI inflation picked up in the spring of 2010