Reserve Bank of India’s (RBI’s) forward-looking surveys in January
2025 said the Indian households expect moderation in inflation for the
near term while consumer confidence declined marginally due to
somewhat tempered sentiments.
The households’ median perception of current inflation declined
marginally by 10 basis points (bps) to 8.3%, as compared to 8.4% of
the previous survey round held in November 2024.
Median inflation expectation for the three months horizon increased by
20 bps to 9.3%. It inched up by 10 bps to 10.2% for one year ahead.
According to the survey report, the inflation expectations showed an
upward trajectory for three months and one-year ahead period.
Reflecting confidence on spending, households’ assessment on one-year
ahead outlook remained firmly in the optimistic territory, it added.
There was an increase in share of households anticipating rise in
general prices and inflation for both near term as well as the coming
year. They expect somewhat higher inflationary pressures across
product groups, especially for food products and housing, for both the
time horizons.
For one year ahead, the price expectation of households is closely
aligned with food prices and housing-related expenses, the survey
said.
According to the survey, the consumer confidence survey showed subdued
sentiments on spending for both essential and non-essential outlays
vis-à-vis the November 2024 round.
Despite some moderations, the sentiments about future spending
remained strong, it added.