The People's Bank of China recently released data showing that RMB deposits increased by 15.39 trillion yuan in the first quarter, an increase of 4.54 trillion yuan year-on-year. Among them, household deposits increased by 9.9 trillion yuan, accounting for over 60% of new deposits. Experts believe that the increase in household deposits is mainly influenced by factors such as household consumption, leading to an increase in liquidity preferences. With the macroeconomic recovery, residents' confidence in consumption and investment will increase, and their savings will gradually return to normal. Where does excess savings come from? The significant increase in household deposits was already reflected last year. Data shows that in 2022, RMB deposits increased by 26.26 trillion yuan, of which household deposits increased by 17.84 trillion yuan, an increase of 7.94 trillion yuan compared to the previous year, setting a new historical high. This year, residents' deposits continue to maintain rapid growth. In January, household deposits increased by 6.2 trillion yuan, setting a new historical high in a single month. The habit of Chinese residents saving money has led to a high savings rate in China, but the formation of excess savings last year cannot be explained solely by residents' love for saving money. Overall, it is the result of multiple factors such as preventive savings, lower financial returns, and sluggish consumption. Last year, under the combined influence of multiple factors such as the disturbance of the epidemic, real estate pressure, and financial market fluctuations, residents' savings increased significantly. This includes both passive savings due to the restrictions of the epidemic on consumption scenarios and preventive savings due to increased economic uncertainty. From the perspective of structural distribution, excess savings were mainly concentrated in middle and high income groups with stable incomes, with low income groups having a relatively large proportion of rigid consumption and a limited decrease in expenditure growth rate According to Guan Tao, Global Chief Economist of Bank of China Securities. Specifically, under the impact of the epidemic, the economic cycle is not smooth, production and consumption scenarios are limited, and the growth rate of residents' income and consumption expenditure has decreased. The second is the decline in sales of commercial housing, resulting in a decrease in residents' housing expenses. The third issue is the overall poor returns in the financial market, especially under the disturbance of the fourth quarter financial redemption turmoil, which has accelerated the return of other allocated assets to bank deposits. The fourth is the implementation of fiscal policies such as tax reduction and fee reduction, as well as tax retention and refund, which has improved the cash flow of enterprises and residential sectors and also converted it into partial savings. The sum of the above three items accounts for about 80% of the total excess savings, and the remaining portion may be due to tax refunds and other factors, "said Guan Tao. Pang Ming, Chief Economist and Research Director of Jones Lang LaSalle in Greater China, believes that the cause of residents' excess savings lies in the gap between the growth rate of disposable income and consumption expenditure. From the perspective of income, various financial measures such as tax cuts, fee reductions, tax deferrals, and tax refunds have supported savings; From a consumer perspective, the main reasons are "not daring to spend", "unwilling to spend", and "unable to spend". 'Not willing to spend' refers to preventive and cautious savings caused by factors such as expectations, confidence, and emotions. 'Not willing to spend' involves consumption willingness, tendency, ability, and resilience, while 'not able to spend' is more influenced by short-term factors and structural barriers. The growth momentum has slowed down since the beginning of this year. Although deposit growth is still at a high level, the proportion of household deposits has decreased. In the first quarter, the proportion of newly added resident deposits in newly added RMB deposits exceeded 60%. On a monthly basis, residents' deposits accounted for 90% of the newly added deposits in January, compared to March