'Indian consumer confidence drops; ranked 3rd globally'
New Delhi: Consumer confidence in India declined during the second quarter of this year putting it on third position globally with concerns of rupee devaluation and continuing inflation bothering urban Indians, according to global information and insights provider Nielsen.
As per a global consumer confidence index study by Nielsen, India which was ranked second in first quarter of 2013 has now slipped to the third most optimistic country, after Indonesia and the Philippines.
"India has slipped to the third most optimistic country, after Indonesia and the Philippines indexed at 124 and 121 respectively," the survey said.
Consumer confidence in India was indexed at 118 in Q2 2013, a two-point decline from Q1 2013 (120), and a one-point decrease from Q2 2012 (119).
"The dip in confidence over the last six months reflects the concerns of the devaluation of the rupee and the continuing inflation for urban Indians," Nielsen India Region President Piyush Mathur said.
Overall discretionary spending has taken a hit with families cutting down on out of home entertainment and expenditure, he added.
"Consumers are also being cautious and are controlling expenses for essentials. However, they are relatively optimistic about the job market which can be the function of some sectors with more opportunities," Mathur said.
According to the survey, shifts in discretionary spending from last quarter indicate the guarded nature of consumers when it comes to spare cash.
"They are looking to stabilise their budgets in key categories, and entertaining out of home is not a priority anymore," he said.
The second quarter is also the post-incentives, post-bonuses period, so the euphoria has settled, and planning for financial stability has been set into place by families.
As per the survey, seven out of 10 Indians (72 percent) are optimistic about their job prospects in the next 12 months, one percentage point below last quarter.
The same period last year indicated higher optimism in job prospects at 77 percent (Q2 2012), it added.
"The top concern for Indians continues to be job security (23 percent), while striking a work-life balance is a concern for one in 10 respondents (10 percent), same as last quarter. The state of economy is the biggest concern for nine per cent of respondents, down three percentage points from last quarter (12 percent in Q1 2012)," according to survey.
The Nielsen Global Survey of Consumer Confidence and Spending Intentions, established in 2005, measures consumer confidence, major concerns, and spending intentions among more than 29,000 respondents with Internet access in 58 countries.