For the fifth quarter India tops global consumer confidence
Wednesday, 25 May 2011, 18:23 IST
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For the fifth quarter India tops global consumer confidence
Mumbai: Job fears and financial concerns are a thing of the past for Indians. They have been replaced by concerns over increasing food prices, with 14 percent of Indians citing this as their biggest concern in the first quarter of the 2011 calendar year, according to a survey by consultancy firm Nielsen. The RBI, in its monetary policy for 2011-12 released earlier this month, had said that international commodity prices are a major area of concern. Nielsen conducted its global survey through online poll found that India topped the global consumer confidence level for the fifth straight quarter, out of the 28,000 people who participated from 51 countries, and 1,000 people in India, Nielsen India managing director (consumer) Justin Sargent told reporters here. When asked how the consumers were buying things, given the high inflation, he said: "The general expectation of a consumer is that inflation is going to continue for a while. So, why not buy things now when you can afford it." "People are trying to preserve their lifestyle by spending on home improvements and decoration," Sargent added. According to the report, 39 percent of Indians spent on home improvements and decoration. However, Sargent expects people to change the consumption pattern if inflation is not controlled. The typically savings-oriented people in India loosened their purse strings to buy technology products, new clothes or spend on vacations. The survey said 65 percent of Indians saved their spare cash during the quarter. Sargent added that high bank interest rates could have prompted the move from consumers. The biggest drop in spare cash investment was in mutual funds, as only 36 percent preferred to invest in the sector, compared to 45 percent in the previous quarter. The survey mentioned that 72 percent of Indians changed spending habits to save on household expenditure, with 53 percent trying to save on gas and electricity expenditure. With high inflation impacting borrowing costs, 16 percent of Indians said they wanted better deals on home loans, insurance and credit cards. According to the Nielsen Global Consumer Confidence report, 91% of Indians were optimistic about their job prospects in the next 12 months. However, he said the performance by India was flat on a quarter-on-quarter basis, as the index maintained the same level of 131 points as the last quarter (October-December, 2010). The RBI, in its monetary policy for 2011-12, released earlier this month, had said that international commodity prices are a major area of concern. It had projected headline inflation to average 9 percent during the first half of the fiscal, before moderating to around 6 percent by year-end. Headline inflation has been above 8 percent since January, 2010. As per latest data, it stood at 8.66 percent in April this year.
Source: PTI
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