Metro Manila (CNN Philippines) — The number of households with savings reached a record high of 31.6% in the first quarter (Q1) of 2015. The figure is markedly higher than the 25.7% registered in the last three months of 2014.
This is the finding of a recent survey from the Bangko Sentral ng Pilipinas (BSP).
In its Consumer Expectations Survey for Q1 2015, the central bank found that households with savings increased in all income groups. The middle-income group (P10,000 to P29,999) experienced the highest quarter-on-quarter increase, followed by the low-income group (less than P10,000).
However, the differences are stark when grouped respondents are grouped according to income. Only 19.5% of low-income earners have savings, compared to 40.2% of middle-income earners and 68.9% of high income (P30,000 and over) earners.
When the households were grouped as a whole, it was found that emergency preparedness was the chief reason for saving, followed by education, health and hospitalization, retirement, and business and capital investment.
More than two-thirds (68.5%) of savers have bank deposit accounts. Likewise, 39% of the aggregate kept their savings at home, and 24.9% of the group put their money in cooperatives and other credit associations.
Households that considered Q1 as a good time to buy big ticket items, such as motor vehicles and housing, also increased to an all time high of 28.4%. The real estate sector drew the most optimistic sentiments, followed by consumer durables and motor vehicles.
The outlook was driven by the respondents’ three beliefs: real property is a good investment, consumer durables are affordable, and motor vehicles can be used for personal and private use. The rollback in oil prices was cited as another reason for buying motor vehicles.
However, consumer sentiment remained pessimistic for Q1 at -10% in the Confidence Index (CI) despite notching a double-digit improvement from the previous quarter’s -21.8%. Respondents attributed the improvement to lower oil prices and stable commodity prices, higher family income, more jobs, peso appreciation, and the improvement of road infrastructure.
Nevertheless the sentiments for the next quarter remain positive, at 4.4% in the CI. Households are also positive for the year ahead, with an average figure of 17.3%.
