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The Reserve Bank of India (RBI) uses multiple surveys to assess consumer and expert expectations. It doesn’t publish too much detail about the way these surveys are constructed. So, we must take the rigour on trust. One set of surveys involves professional forecasters. Another involves consumer and household expectations. The professional forecasters are asked questions about macroeconomic trends. The questions to consumers range around inflation expectations, employment, spending plans, etc.
Such surveys could have large error factors — at several levels. Survey construction could also lead to biases. Forecasters are also often wrong in their projections, as are households. However,
Disclaimer: These are personal views of the writer. They do not necessarily reflect the opinion of www.business-standard.com or the Business Standard newspaper
