This helps the interviewer get an idea whether you lead a balanced life or whether you are too focused to have hobbies and outside interests and also regarding the kind of person you are. Remember here: the more outside commitments you have, the less attractive you’d look to potential employers. “Watching Television” or “playing PC games” may distract the employer’ attention. Reading good books (you may name a few books related to your subject) will be a good answer. Though, it would be suspicious if you say that your hobbies are studying financial market or working overtime for free.   _{Your Comment}