Consumer confidence in economy turns 'pessimistic'; people worry about jobs, income
Mumbai: Amidst talks of a slowing economy, consumer confidence in the economic scenario of the country has turned negative as people remain pessimistic about price levels, income and dipping employment opportunities.
Surveys undertaken by the Reserve Bank of India (RBI) indicated that households’ current perceptions on the general economic situation remained in the “pessimistic zone for four successive quarters, with the outlook worsening”.
The RBI Consumer Confidence Survey that was conducted in six metropolitan cities and obtained 5,100 responses held that only 34.6 per cent of the respondents felt the economic situation had gotten better as of September 2017, as compared to 44.6 per cent in September, 2016.
In fact, 40.7 per cent felt the economy has worsened as of September, 2017 as compared to 25.3 per cent in September, 2016.
These sentiments are in line with the economic data released in the last couple of months that indicate a sluggish growth in the economy with GDP falling to a three-year low of 5.7 per cent. The Monetary Policy Committee also in its October meet slashed its growth expectations from 7.3 per cent to 6.7 per cent.
The Consumer Confidence Index stood at 118.8 in September, 2017 as compared to 120.8 in June, 2017.
Employment seemed to be one of the biggest causes of worry for respondents - “with sentiment plunging further into the pessimistic zone; the outlook on employment has also weakened in the last two rounds”, the report said. Only 30.7 per cent felt that employment opportunities had improved as of September this year while 43.7 per cent felt it had worsened.
However, despite the bitter sentiment on income, more than 80 per cent of respondents reported increased spending over the past year which could partly be attributed to the hike in prices. Nearly 87.7 per cent of respondents felt that prices had gone up. Data also showed that retail inflation in August hit a five-month high, rising up by 3.36 per cent.
The Consumer Confidence Survey was conducted in six metropolitan cities — Bengaluru, Chennai, Hyderabad, Kolkata, Mumbai and New Delhi.
