The Consumer Outlook Index, a barometer for consumer confidence, reflects current and future spending plans, employment and inflation outlook of urban Indian consumers. It is based on a monthly survey of 4,000 consumers in 18 cities across India. A score above 50 reflects optimism, while below 50 is an indication of pessimism. In September 2014, of the 18 cities surveyed, 13 showed improvement in consumer confidence as compared to the previous month. The five cities with the highest scores were Hyderabad, Mangalore, Delhi, Guwahati and Bengaluru.
Key Highlights of the ZyFin Consumer Outlook Index for September 2014:
· The ZyFin Consumer Outlook Index of India (COI) has registered a score of 45.2 in September 2014, as compared to 43.6 in the previous month. The uplift in sentiment this close to the festive season is an encouraging sign, particularly after two lacklustre years.
· The COI comprises three major components, measuring consumer sentiment on spending, employment and inflation.
· The Spending Sentiment Index assesses willingness to make big-ticket purchases such as homes, home appliances, four- and two-wheelers in the next six months. The index has improved to 32.3 in September 2014 from 30.8, with improvements in every product category surveyed.
· The Employment Sentiment Index is a tracker of the employment situation as perceived by consumers. The index moved up to 53.1 in September 2014 from 50.9 in August 2014. Consumer outlook on personal job security and the unemployment rate has shown a healthy increase over the previous month.
· The Inflation Sentiment Index is based on the largest inflationary expectations survey in the world. In September 2014, the index dropped by 0.9 points to 25.8, from 26.7 in the previous month, reflecting that consumers are still significantly aggrieved by inflationary conditions, and do not expect price levels to come down in the near future.
Giving his views on the ZyFin Consumer Outlook Index numbers for the month of September, Mr. Debopam Chaudhuri, Chief Economist, ZyFin Research, said, “After accurately predicting muted festive season sales in 2012 and 2013, the latest readings of the index point towards a departure from this trend. A steady uptrend in the Spending Sentiment Index strongly suggests that the 2014 festive season would result in higher sales within categories like homes, two- and four-wheelers as well as home appliances.”