Inflation Survey

Inflation Survey

Subject: Economy

Section: Inflation

Context

• According to the RBI survey, for a majority of population and age groups, uncertainty in inflation expectations increased for both three months and one year horizons, as compared to the previous survey round according to the Inflation Expectations Survey of Households.
• According to the central bank’s Consumer Confidence Survey (CCS), consumer confidence for the current period continued on its recovery path.

Concept:

• Inflation Expectations Survey of Households-
  • The survey is conducted at bi-monthly intervals by the Reserve Bank of India.
  • It provides directional information on near-term inflationary pressures as expected by the respondents and may reflect their own consumption patterns. Hence, they should be treated as households’ sentiments on inflation.
  • The survey aims at capturing subjective assessments on price movements and inflation, of approximately 6,000 households, based on their individual consumption baskets, across 18 cities, including -Ahmedabad, Bengaluru, Bhopal, Bhubaneswar, Chandigarh.
  • The survey seeks qualitative responses from households on price changes (general prices as well as prices of specific product groups).
  • It measures Households’ median inflation perceptions in three periods– for the current period, three months ahead as well as in the one year ahead period.

• Consumer Confidence Survey-
  • It is conducted every two months by the Reserve Bank of India.
  • The CCS is a survey that indicates how optimistic or pessimistic consumers are regarding their expected financial situation. If the consumers are optimistic, spending will be more, whereas if they are not so confident, then their poor consumption pattern may lead to recession.
  • Consumer Confidence Survey (CCS) for the March 2022 round was conducted from March 02 to March 11, 2022 in 19 major cities including Bengaluru, Chennai, Delhi, Hyderabad, Ahmedabad, Jaipur, Lucknow, Patna, Thiruvananthapuram, Mumbai.
  • The survey obtains current perceptions (vis-à-vis a year ago) and one year ahead expectations on general economic situation, employment scenario, overall price situation and own income and spending from 5,984 households across these cities.
  • Based on these specific responses, the RBI constructs two indices: the Current Situation Index (CSI) and the Future Expectations Index (FEI).
  • The CSI maps how people view their current situation (on income, employment etc.) vis a vis a year ago. The FEI maps how people expect the situation to be (on the same variables) a year from now.

Consumer Confidence Survey- march 2022