According to the latest survey by the Reserve Bank of India (RBI), Indian consumers are expected to increase spending over the next one year, with both essential and non-essential items increasing.
RBI’s Consumer Confidence Survey (CCS) showed that the rise in consumer confidence has stalled for the current period as sentiments have declined slightly on all parameters except spending in the latest survey round.
The Current Situation Index (CSI) declined to 97.1 in May 2024 from 98.5 two months ago.
“For the year ahead, consumer confidence remained elevated in optimistic territory, although it declined marginally due to relatively soft sentiments on general economic conditions and employment prospects,” the survey showed.
The Future Expectations Index (FEI) stood at 124.8 in May 2024 (125.2 in the previous survey round).
CSI and FEI are compiled on the basis of net responses to economic conditions, income, expenditure, employment and price level for the current period (compared to one year earlier) and one year ahead respectively. The survey was conducted from May 2-11, 2024, involving 6,083 respondents.
Separately, another RBI survey showed that domestic inflation expectations for the three-month and one-year ahead periods rose by 20 basis points (bps) and 10 bps to 9.2% and 9.9%, respectively. One basis point is one hundredth of one profit point.
However, their outlook on current inflation eased by 10 bps to 8%, showed the latest round of RBI’s domestic inflation projections.
A high share of respondents expected prices and inflation to rise for all major product groups over the next three months as well as one year. At the cumulative level, female respondents had vaguely lower increase assessments and hope than their male counterparts.
The survey was conducted across 19 major cities during May 2-11, 2024, with responses from 5,943 urban households. RBI said the number of female respondents in this sample was 52.6%.
