Consumer Confidence Survey (CCS) India

Consumers pessimistic about current economic conditions, but expect a brighter future.

Note: Consumer confidence survey was published quarterly by the Reserve Bank of India (RBI) before March 2016.

Published bi-monthly by the RBI. Updated to the month of September 2018 (published on October 5, 2018)

Recent Data Trend

In the September round of Consumer Confidence Survey (CCS), the consumer confidence waned reflecting worsening of consumers' perception on the general economic conditions as well as on employment scenario.

The current situation index (CSI) continued to remain in the pessimistic zone in Sep'18 falling to 94.8 in the current round of CCS from 98.3 in the Jun'18 round of survey. The worsening of CSI depicts that consumers continue to be wary of the general economic conditions prevailing in the economy. The CSI has remained in the pessimistic zone since last one year.

However, households’ were optimist about the economic conditions in the future as measured by the future expectations index (FEI) improved to 121.1 in Sep'18 from 119.8 in Jun'18.

Households' perception of the current economic conditions deteriorated compared to previous round, around 44.3% felt it had worsened and 33.7% believed it had improved. Optimism on the one-year ahead expectations improved with 53.1% stating the situation would improve.

On the employment front, the respondents didn't show much optimism over the current employment situation, with almost 45.5% of the respondents conforming to the view that employment prospects had worsened as against 35.5% who felt it had improved. On the other hand, 54.1% responded that their outlook on job prospects one-year ahead will improve.

Households’ assessment of the current price situation and the outlook a year ahead broadly continued to be pessimistic. There was only a slight improvement in their expectations one year ahead.

Overall, the decline in consumer sentiments regarding the general economic conditions seems surprising given the recent recovery in the GDP growth to 8.2% YoY during Apr-Jun'18. Further, the employment situation continues to be a concern. This also shows that the government might not have been able to build enough confidence in people to buy goods and services (as indicated through the survey). Clearly, it should take more measures, given that the 2019 Lok Sabha elections is nearing.

Brief Overview

Consumer confidence survey (CCS) has been conducted by the Reserve Bank of India (RBI) on a quarterly basis since June 2010 and on a bi-monthly basis since March 2016. The survey obtains information on urban consumer sentiments and captures qualitative responses on questions pertaining to economic conditions, household circumstances, income, spending, prices, etc. For each round of the survey, approx 5400 respondents (aged 21 years and above) are canvassed in six metropolitan cities of Bangalore, Chennai, Delhi, Hyderabad, Kolkata, and Mumbai. The responses are mostly in two parts- current situation as compared to a year ago and expectations a year ahead. Expectations on prices and consumer spending are in three forms: increased remained the same and decreased or positive, neutral and negative.

To combine the consumer confidence responses on various parameters, two sub-indices are calculated by the RBI: Current Situation Index (CSI) that reflects the current situation as compared to one year ago and Future Expectation Index (FEI) that reflects expectations one year ahead. CSI and FEI are compiled on the basis of net responses on the economic situation, income, spending, employment and the price level for the current period and a year ahead, respectively. CSI/FEI = 100 + Average of Net Responses of the above parameters. CSI and FEI are compiled on the basis of net responses on the economic situation, income, spending, employment and the price level for the current period and a year ahead, respectively. CSI/FEI = 100 + Average of Net Responses of the above parameters. The CSI and the FEI can take values between 0 and 200. An index value over 100 implies that consumers are optimistic about the current/future situation and vice versa.

The responses to the main variables of the survey, viz, income, spending, employment, etc are recorded in terms of percentage. Percentage responses on income and spending are the respondents' own view, i.e, personal income and personal spending.

For more information, please visit the official government website.

Next Release Date: December 7, 2018