India's consumer confidence recorded by RBI's forward-looking survey released on Thursday showed that it has hit an all-time low owing for the month of July, in the prevailing economic situation worsened by the coronavirus pandemic. The current situation index, a measure of consumer confidence, dropped to 53.8 in July from 63.7 in May, according to RBI's data.
The central bank said that the survey was conducted through telephonic interviews during 1 to 12 July 2020 of 5,342 households in thirteen major cities which showed that consumer perception of the prevailing economic situation, employment scenario and own income was significantly lower than that in May 2020.
The thirteen cities surveyed are Ahmedabad, Bengaluru, Bhopal, Chennai, Delhi, Guwahati, Hyderabad, Jaipur, Kolkata, Lucknow, Mumbai, Patna, and Thiruvananthapuram.
Most respondents reported a reduction in discretionary spending through their overall spending increased during the last one year. They do not expect to increase non-essential spending in the coming year as well, it said.
However, the respondents remained optimistic about the coming year vis-a-vis the previous survey round.
The future expectations index for the year, however, rebounded into the positive territory indicating signs of recovery for the year ahead.
The inflation expectation of households increased rose by 0.6 perent in July as compared with May, according to the survey and the current median inflation perception rose to 9.9 percent.
The Business Assessment Index fell sharply to an all-time low of 55.3 in the first quarter of the financial year 2020-21 from 102.2 in the previous quarter.