Banks have seen money in fixed deposits (FDs) increase by Rs 6.1 lakh crore during the period April to July 3. This is more than twice the Rs 3 lakh crore of FDs added by banks during the same period in the previous financial year. An increase in FDs is an indication that investors expect interest rates to come down further. It is also reflective of risk-aversion. From the deposit numbers of the large banks that have declared their results so far, it is seen that the share of FDs is either rising or is steady. In the case of HDFC Bank, which has seen deposits grow 24% year on year in the first quarter, the current account-savings account (CASA) ratio slipped to 40.1% from 42.2% in March. For Axis Bank, the CASA ratio, which was 41.2% in March, is now 40.9% at the end of the first quarter. Kotak Mahindra Bank has shown a marginal improvement with the CASA ratio rising to 56.7% from 56.2%. ICICI Bank’s CASA for the first quarter was 41%, down from 42.7% for FY20. State Bank of India (SBI) has also shown growth from 45.1 to 45.3%. For FY20, bank deposits accounted for 52.6% of household savings, followed by life insurance (23.2%), currency (13.4%) and mutual fund holdings (7%). Given the slowdown in insurance and mutual fund savings, there is a strong likelihood that the share of bank deposits in household savings could rise.