Consumer perception on the general economic situation, employment scenario and household income plunged deeper into contraction zone, results of the May 2020 round of Consumer Confidence Survey (CCS) by the RBI shows.
The survey was conducted through telephonic interviews during May 5-17, 2020 in thirteen major cities, viz., Ahmedabad; Bengaluru; Bhopal; Chennai; Delhi; Guwahati; Hyderabad; Jaipur; Kolkata; Lucknow; Mumbai; Patna; and Thiruvananthapuram.
"Consumer confidence collapsed in May 2020, with the current situation index (CSI) touching historic low and the one year ahead future expectations index also recording a sharp fall, entering the zone of pessimism," the RBI Survey has stated.
Overall consumer spending remained afloat, mostly due to relative inelasticity in essential spending consumers, however, reported sharp cuts in discretionary spending and also do not expect much improvement in the coming year.
Perceptions and expectations on general economic situation, employment scenario, overall price situation and own income and spending have been obtained from 5,300 households across these cities.
Three months and one year ahead median inflation expectations rose by 190 and 120 basis points, respectively, over the previous round, the RBI survey showed . Expecting increasing price pressure on food products, more households expect general prices and inflation to rise over three months horizon as compared to previous round . However, the prices of all product groups, especially cost of housing, are expected to ease over a year ahead period.