Consumers see further rise in spending over one year, says RBI survey

More respondents see inflation rise over one year

Reflecting momentum for robust growth, consumers expect a higher rise in overall spending over the next year compared to the previous survey round, according to the Reserve Bank of India’s (RBI) Forward Looking Surveys.

The results of the May 2024 round of RBI’s bi-monthly consumer confidence survey showed more respondents expect an increase in both essential and non-essential spending.

The survey collected current perceptions and one-year-ahead expectations of households on the general economic situation, employment scenario, overall price situation, own income, and spending across 19 major cities. RBI’s latest round of the survey was conducted during May 2-11, 2024, covering 6,083 respondents. Female respondents accounted for 52.7 per cent of this sample, RBI said in a statement.

Consumer confidence for the current period paused on its uptrend as sentiments on all parameters, except spending, recorded some moderation. The current situation index (CSI) moderated to 97.1 in May 2024 from 98.5 two months ago.

For the year ahead, consumer confidence remained at an elevated level in the optimistic terrain. However, sentiments were relatively tempered on the general economic situation and employment prospects. The future expectations index (FEI) stood at 124.8 in May 2024, down from 125.2 in the previous survey round.

RBI’s Household Inflation Expectations Survey indicated that a higher share of respondents expected prices and inflation to rise for all major product groups over the next three months as well as one-year periods.

At the aggregate level, female respondents had marginally lower inflation assessment and expectations than their male counterparts.