Rural sentiments are volatile but they matter

Labour conditions in rural India are relatively stable but consumer sentiments are quite volatile

The RBI's Consumer Confidence Survey shows that employment conditions in urban India worsened sharply following demonetisation and the condition has not improved since then. Since the December 2016 survey, 39 per cent of the respondents have been saying that the employment conditions have worsened compared to a year ago. This ratio had never touched 39 per cent before. In fact, the past average was close to 30 per cent. Therefore, this is a sharp jump in the proportion of respondents saying that the job market has worsened.

The RBI's survey is limited to only six cities. But, its