MNI India Consumer Report - September 2013

MNI India Consumer Report September 2013

Insight and data for better decisions

MNI India Consumer Report - September 20132

About MNI Indicators Insight and data for better decisions

MNI Indicators offers unique macro-economic data and insight to businesses and the investment community. We produce data and intelligence that is unbiased, pertinent and responsive. Our data moves markets.

Specialising in business and consumer focused macro-economic reports, we give our customers the ability to make timely and relevant decisions. We strive to provide up-to-date information on business and consumer confidence on the economy.

MNI Indicators publishes data on a monthly basis. Our indicators are based on a unique and proprietary methodology and are designed to present an advance picture of the economic landscape as perceived by businesses and consumers every month.

Our monthly reports explore attitudes, perspectives and confidence across different countries and regions. They deliver in-depth analysis, highlight changing patterns and how these can affect potential developments in business and consumer activities.

MNI Indicators is part of MNI, a leading provider of news and intelligence. MNI is a wholly owned subsidiary of Deutsche Börse Group, one of the largest worldwide exchange organisations.

Written and researched byPhilip Uglow, Chief EconomistLorena Castellanos, EconomistShaily Mittal, Economist

MNI Indicators | Deutsche Börse Group Westferry House11 Westferry CircusLondon E14 4HETel: +44 (0)20 7862 7444Email: [email protected]

www.mni-indicators.com

Copyright© 2013 MNI Indicators | Deutsche Börse Group. Reproduction or retransmission in whole or in part is prohibited except by permission. All rights reserved.

MNI India Consumer Report - September 2013 3

MNI India Consumer Report - September 2013Contents

4 Editorial

6 Executive Summary

12 Economic Landscape

16 Indicators

17 MNI India Consumer Indicator

24 Personal Finances

27 Current Business Conditions

30 Durable Buying Conditions

31 Employment Outlook

33 Prices Sentiment

36 Interest Rate Expectations Indicator

37 Stock Investment Indicator

41 Real Estate Investment Indicator

44 Car Purchase Indicator

46 Consumer Sentiment - Regions

50 Consumer Sentiment - Income Group

51 Data Tables

59 Methodology

MNI China Consumer Report - July 20134

Mervyn King, former governor of the Bank of England, once said that central bankers should aspire to be boring because, “boring is best”. Not so these days.

Rock stars, Onions and Inflation


Mervyn King, former governor of the Bank of England, once said that central bankers should aspire to be boring because, “boring is best”.

Not so these days. “Helicopter Ben” was drafted to the Federal Reserve to save the US economy. “Super Mario” took the helm at the European Central Bank, while “Rock Star” central banker Mark Carney took over at the Bank of England earlier this year.

Step forward Mr Raghuram Rajan, former IMF Chief Economist and holder of a PhD from the Massachusetts Institute of Technology. Media hasn’t settled on a single moniker yet, but whether he’s eventually the “Governator” or simply a “Superstar” central banker, he’s already made waves. At his first monetary meeting on September 20, Rajan stamped his authority by surprising markets and raising the repo rate 25 basis points to 7.5%.

This was a bold step for a new governor who has seen growth in India grind to its lowest level in more than three years in the three months to June. The move may be as much about flexing his anti-inflation credentials as well as preparing for the imminent Fed tapering.

“Let us remember that postponement of tapering is only that – a postponement,” Rajan said after the rate hike. “We must use this time to create a bulletproof national balance sheet and growth agenda that creates confidence in investors and citizens alike.”

While the central bank has a key role to play in managing the demand side of the economy, many of India’s current problems lie on the supply side, which are issues the government needs to tackle - and they deserve most of the current flack for doing very little. Greater infrastructure planning, cuts to overbearing regulation and dealing with corruption are just a few things they need to get to grips with.

The RBI’s decision to tighten monetary policy in response to higher inflation expectations hasn’t escaped criticism given the current lack of growth. While wholesale price inflation rose to 6.1% in August,

from 5.8% in July - further above the central bank’s 5.5% end-year target – most of this was due to higher prices of food and fuel. Core inflation, which excludes food and fuel, stood at just 1.9%.

The price of onions has risen by an eye watering 245% over the past year. For a country where the humble onion is used in just about every dish, it’s a key issue and has been blamed for toppling two governments in the past 30 years. But should monetary policy concern itself with the price of onions or the wider rise in food prices? Certainly the former appears to be due to a combination of a poor harvest and also a lot of hoarding from some less than scrupulous wholesalers. Monetary policy can do nothing to address such problems.

Possibly the RBI should target core inflation which should give a better picture of underlying price pressures in the economy, but as previous RBI governor Duvvuri Subbarao has pointed out, how can a measure of core inflation exclude nearly 65% of the consumption basket be termed ‘core’. He’s got a point and it underlies the difficulty faced by the central bank in trying to manage inflation expectations.

While new superstar Rajan might have been brought in to save India, his efforts will be to no avail should the government not play its part to drive reforms, support growth and most of all sort out those onions…

Philip UglowChief EconomistMNI Indicators


Four out of five components which contribute to the India Consumer Indicator fell in September, with Current Personal Finances the only indicator to post an increase.

Executive Summary


The MNI India Consumer Indicator declined for the fourth consecutive month in September, to the lowest level since the series started in November 2012 amid tepid economic growth, the weakness in the rupee and continued high inflation.

The decline was led by a sharp fall in the percentage of consumers who felt it was a good time to buy a large household item, likely due to the current economic uncertainty India has been facing.

The Consumer Indicator fell to 115.9 in September from 118.7 in August, nearly 9.0% down since the start of the year. Sentiment has trended downwards since November and has only posted monthly rises in two months, April and May.

Four out of five components which contribute to the India Consumer Indicator fell in September, with Current Personal Finances the only indicator to post an increase. Both current and future measures of confidence posted record lows in September.

Consumer sentiment worsened in the youngest and oldest of the three main age groups and remained stable for the 35-54 age range.

There was a sharp decline in consumer confidence in East India. Smaller falls were also seen in the Central and West India regions.

Confidence worsened in broadly equal measure in both low and high income households. Since February, confidence has fallen by more in high income households compared with low income households.

Among the top ten cities covered in the survey, consumer confidence improved only in Mumbai, Bangalore and Hyderabad and fell in the remaining seven.

The Employment Indicator fell sharply in September, declining to the lowest level since February, led by declines in the East, West and Central regions.

Concerns over inflation intensified in September with respondents increasingly worried about the current level of prices and expectations for the future hitting a series high.

The Real Estate Investment Indicator slipped to a new record low in September, in spite of a growing expectation that prices will increase in the future.

The climate for buying a car was the worst since the survey began in November 2012, underlying the concerns consumers have about the current economic situation.

The Stock Investment Indicator rose in September to its highest level since June, as investors reported higher returns over the past twelve months.

MNI India Consumer Indicator - Components

MN

I Ind

ia

Cons

umer

Indi

cato

r

Pers

onal

Fin

ance

: Cu

rrent

Pers

onal

Fin

ance

: Ex

pect

ed

Dur

able

Buy

ing

Cond

ition

s

Busi

ness

Con

ditio

n in

1 Y

ear

Busi

ness

Co

nditi

ons

in 5

Ye

ars


All India - Overview

Jul-13 Aug-13 Sep-13Highest

Since Lowest

Since 3-Month Average

Monthly Change

Monthly % Change

MNI India Consumer Indicator 119.5 118.7 115.9 - Series Low 118.0 -2.8 -2.4%

Current Indicator 114.1 113.9 109.3 - Series Low 112.4 -4.6 -4.0%

Expectations Indicator 123.0 122.0 120.3 - Series Low 121.8 -1.7 -1.4%

Personal Finance: Current 114.2 116.3 118.0 May-13 - 116.2 1.6 1.4%

Personal Finance: Expected 121.9 122.1 118.4 - Series Low 120.8 -3.7 -3.0%

Business Condition: 1 Year 121.2 115.3 114.1 - Series Low 116.9 -1.1 -1.0%


Durable Buying Conditions 114.0 111.5 100.7 - Series Low 108.7 -10.8 -9.7%

Current Business Conditions Indicator 113.1 111.4 108.9 - Series Low 111.2 -2.5 -2.3%

Stock Investment Indicator 105.1 104.6 106.4 Jun-13 - 105.4 1.8 1.7%

Real Estate Investment Indicator 115.1 109.8 109.7 - Series Low 111.5 -0.1 -0.1%

Car Purchase Indicator 68.5 61.6 60.1 - Series Low 63.4 -1.6 -2.5%

Employment Outlook Indicator 120.9 119.2 113.2 - Feb-13 117.7 -6.0 -5.0%

Inflation Expectations Indicator 144.4 152.9 156.1 Series High - 151.1 3.2 2.1%

Current Prices Satisfaction Indicator 93.9 92.6 83.2 - Mar-13 89.9 -9.4 -10.1%

Interest Rates Expectations Indicator 129.6 133.8 136.1 Series High - 133.1 2.3 1.7%


All India - Summary2012 2013

Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep

MNI India Consumer Indicator 133.7 129.3 127.3 122.9 119.7 123.9 124.5 122.9 119.5 118.7 115.9

Current Indicator 128.3 123.9 123.5 115.1 116.8 119.5 120.7 113.7 114.1 113.9 109.3

Expectations Indicator 137.3 132.9 129.8 128.1 121.6 126.8 127.0 129.0 123.0 122.0 120.3

Personal Finance: Current 135.4 130.0 133.9 123.4 116.6 121.1 122.2 115.8 114.2 116.3 118.0

Personal Finance: Expected 141.5 134.0 136.0 132.5 124.0 131.8 131.0 128.3 121.9 122.1 118.4

Business Condition: 1 Year 130.8 131.8 129.6 119.7 114.9 117.2 119.4 124.2 121.2 115.3 114.1

Business Condition: 5 Year 139.7 132.8 123.9 132.0 126.0 131.6 130.5 134.6 126.0 128.5 128.4

Durable Buying Conditions 121.1 117.8 113.0 106.8 117.1 117.9 119.2 111.6 114.0 111.5 100.7

Current Business Conditions Indicator 123.4 124.9 122.3 121.2 116.4 120.0 121.0 118.4 113.1 111.4 108.9

Stock Investment Indicator - - - 102.9 104.5 102.3 101.4 110.1 105.1 104.6 106.4

Investment Return 136.5 108.1 112.7 106.5 110.1 105.1 104.0 102.7 112.7 111.1 125.2

Stock Price Sentiment - - - 102.0 104.2 103.7 103.5 100.4 111.9 116.5 124.8

Stock Market Expec-tations 134.4 105.5 118.5 104.1 107.5 105.5 103.8 127.8 114.6 119.2 118.8

Real Estate Invest-ment Indicator - - - 116.9 119.4 119.9 113.1 115.7 115.1 109.8 109.7

House Price Expec-tations - - - 138.7 142.4 139.1 133.3 136.3 135.1 140.8 144.7

House Buying Sen-timent 109.4 106.1 106.1 116.4 118.1 121.5 115.5 119.7 114.7 100.6 98.1

House selling Senti-ment 112.6 110.1 112.5 104.5 102.2 101.1 109.4 109.0 104.4 111.9 113.6

Car Purchase Indi-cator 83.1 84.0 71.5 80.1 76.6 76.4 75.8 69.5 68.5 61.6 60.1

Car Purchase expec-tations 114.8 110.5 106.9 107.6 107.3 109.2 106.0 98.5 105.7 94.3 90.3

Price of Gasoline expectations 148.6 142.5 164.0 147.4 154.0 156.4 154.5 159.5 168.7 171.0 170.2

Employment Outlook Indicator 128.3 116.4 124.6 112.2 119.1 123.4 127.9 122.6 120.9 119.2 113.2

Inflation Expectations Indicator 135.7 126.8 149.4 152.4 145.6 134.0 136.5 143.9 144.4 152.9 156.1

Current Prices Satisfac-tion Indicator 115.9 102.8 91.3 76.7 78.2 96.5 99.7 96.4 93.9 92.6 83.2

Interest Rates Expecta-tions Indicator 126.7 123.6 130.6 131.4 116.6 123.0 125.6 120.4 129.6 133.8 136.1

All India - Records2012-2013

Minimum Maximum Mean Median

MNI India Consumer Indicator

Current Indicator 115.9 133.7 123.5 122.9

Expectations Indicator 109.3 128.3 118.1 116.8

Personal Finance: Current 120.3 137.3 127.1 127.0

Personal Finance: Expected 114.2 135.4 122.5 121.1

Business Condition: 1 Year 118.4 141.5 129.2 131.0

Business Condition: 5 Year 114.1 131.8 121.7 119.7

Durable Buying Conditions 123.9 139.7 130.4 130.5

Current Business Conditions Indicator 100.7 121.1 113.7 114.0

Stock Investment Indicator 108.9 124.9 118.3 120.0

Investment Return 101.4 110.1 104.7 104.5

Stock Price Sentiment 102.7 136.5 112.3 110.1

Stock Market Expectations 100.4 124.8 108.4 104.0

Real Estate Investment Indicator 103.8 134.4 114.5 114.6

House Price Expectations 109.7 119.9 115.0 115.4

House Buying Sentiment 133.3 144.7 138.8 138.9

House selling Sentiment 98.1 121.5 111.5 114.7

Car Purchase Indicator 101.1 113.6 108.3 109.4

Car Purchase expectations 60.1 84.0 73.4 75.8

Price of Gasoline expectations 90.3 114.8 104.6 106.9

Employment Outlook Indicator 142.5 171.0 157.9 156.4

Inflation Expectations Indicator 112.2 128.3 120.7 120.9

Current Prices Satisfaction Indicator 126.8 156.1 143.4 144.4

Interest Rates Expectations Indicator 76.7 115.9 93.4 93.9


w

Economic news over the past month has done little to lessen the economic gloom surrounding India.

Slow economic growth, the fall in the rupee, stubborn inflation and high fiscal and current account deficits, all continue to plague India.


Decisive policy action from the government remains lacking and the possibility of any substantial reform appears unlikely due to the looming national elections in the first half of 2014.

Economic Landscape


Economic news over the past month has done little to lessen the economic gloom surrounding India. Slow economic growth, the fall in the rupee, stubborn inflation and high fiscal and current account deficits, all continue to plague India. GDP growth slumped to 4.4% in April-June compared with the same period a year earlier, the weakest since 2009. While the current account deficit and industrial production improved slightly and prices eased in August, overall demand in the economy remained weak. The new governor of the Reserve Bank of India, Raghuram Rajan, has so far managed to placate markets and his first move to raise interest rates has been seen as a positive step to curb inflation – albeit at the expense of much needed growth.

Slowest GDP growth in four yearsEconomic growth in India slowed to 4.4% in April-June 2013 compared with the same period a year earlier, the lowest in four years. Output was hit due to a contraction in manufacturing, declining by 1.2% on the year, compared with a fall of 1% in April-June 2012, and mining & quarrying which declined by 2.8% compared with growth of 0.4% in the same period a year earlier. Services, which accounts for the highest proportion of total GDP, grew at 6.6% on the year, compared with growth of 7.6% in 2012.

Slowing Economic Growth

0

2

4

6

8

10

12

Q12009

Q32009

Q12010

Q32010

Q12011

Q32011

Q12012

Q32012

Q12013

Industrial Production Growth

-4

-2

0

2

4

6

8

10

Jan-

12

Mar

-12

May

-12

Jul-1

2

Sep-

12

Nov

-12

Jan-

13

Mar

-13

May

-13

Jul-1

3

The continued weakness is another blow to the government, which has been trying to adopt measures to boost the economy, and the latest data makes it less likely the government will achieve the Reserve Bank of India’s GDP forecast of 5.5% for the fiscal year 2013-14. The decision by new governor of the central bank, Raghuram Rajan, to increase the policy rate to 7.5% from 7.25% on September 20 to curb inflation will also hamper growth.

While a good monsoon has raised hopes for stronger agriculture growth, weak growth in both services and industry is likely to remain, as both global and domestic factors continue to weigh.

Decisive policy action from the government remains lacking and the possibility of any substantial reform appears unlikely due to the looming national elections in the first half of 2014.

Industrial production improvesIndustrial production posted a surprisingly strong increase of 2.6% in July compared with a year earlier. Although growth is still weak, it was an improvement over the past two months which registered a decline of 2.3% on average. Manufacturing rose 3.0%, but mining continued to fall, dropping by 2.3% in July.

GDP Growth y/y %

Source: Central Statistics Organisation, India

Industrial Production y/y %

Source: Central Statistics Organisation, India


To sustain growth, the government needs to take some bold measures such as fast track implementation of projects, simplify taxation laws and revive private investments in manufacturing.

The trade deficit shrinks in AugustThe trade deficit narrowed to $10.91 billion in August from $12.29 billion in July and below the $14.2 billion shortfall posted in August a year earlier.

India’s exports grew by 13.0% in August to $26.14 billion compared with $23.13 billion in the same month a year earlier. Imports were little changed falling 0.68% to $37.05 billion, down from $37.31 in August 2012.

substantially weaker Rupee should also eventually help to boost the competitiveness of Indian goods.

India’s current account deficit rose to 4.9% of GDP in the first quarter ending June compared with 3.6% in the quarter ending March and also above the 3.9% posted in the same period a year earlier.

The August trade data pointed to some improvement, although the fall in the rupee, which will have the immediate effect of increasing the cost of imports, makes it less likely that the government will hit its current account deficit target of 3.7% of GDP for the fiscal year.

No escape from rising pricesIndia’s headline inflation, measured by the wholesale price index, increased to 6.1% in August from 5.79% in July, further above the government’s end-year target of 5.5%.

Food price inflation increased to 18.18% in August against 11.91% in July, while fuel prices rose marginally to 11.34% on the year from 11.31% in the previous month.

Wholesale Price Inflation Rising Again

3

4

5

6

7

8

9

Apr-

12

Jun-

12

Aug-

12

Oct

-12

Dec

-12

Feb-

13

Apr-

13

Jun-

13

Aug-

13

India‘s Trade Deficit

0

2000

4000

6000

8000

10000

12000

2006 2007 2008 2009 2010 2011 2012

Demand for oil has continued to strain the import bill due to the continued rise in the oil price, with 70% of India’s oil and gas requirements being imported. Gold imports plummeted from $2.2 billion to $650 million in August on the back of stringent taxes and import controls enforced by the government.

An improvement in the external environment, with a rise in demand from the US and major European economies, has helped demand for exports. A

Merchandise Trade Balance (INR B)

Source: Reserve Bank of India

Wholesale Price Inflation y/y %

Source: Office of the Economic Advisor, India


Although, consumer price inflation eased to 9.52% in August from 9.64% in July, it remained stubbornly high.

The authorities face the problem of stabilising the currency and boosting the economy as well as ensuring inflation is kept in check. In a surprise move the new governor of the central bank, Raghuram Rajan, increased the policy repo rate on September 20 to 7.5% from 7.25% citing inflation worries. The move should also help to bolster the currency.

The government’s efforts to reduce the fuel subsidy bill (by raising administered fuel prices), the ongoing weakness of the rupee and supply side shortages suggest that reducing inflation from current levels will be challenging.

Sticky Consumer Price Inflation

8.5

9.0

9.5

10.0

10.5

11.0

11.5

Apr-

12

Jun-

12

Aug-

12

Oct

-12

Dec

-12

Feb-

13

Apr-

13

Jun-

13

Aug-

13

Measures to contain the fall of the rupeeThe Rupee has fallen sharply since US Federal Reserve Chairman Ben Bernanke warned in May that the Fed could start to taper its bond purchases this year. India has been hit harder than other emerging markets due to its sizeable current account deficit and also a growing inability of the government to move forward with reforms to drive investment – all of which

have led to significant capital outflows. The rupee has fallen around 24% since May to reach an all time low against the US dollar at the end of August.

On September 4, RBI Governor Rajan took office and announced a number of steps to restore confidence and the currency subsequently rebounded nearly 5.5% as of September 18.

Measures included the introduction of swap windows to banks for fresh dollar deposits mobilised from NRIs (Non-Resident Indians), a roadmap for more rupee trade settlements and the introduction of derivative products such as interest rate swaps. These were in addition to certain measures introduced by the outgoing governor, most critical of which was the introduction of a swap facility by the RBI to sell dollars to the nation’s largest oil importers.

Rajan also intends to liberalise banking and provide greater financial access to people in all parts of the country. He expects to announce a round of new bank licences early next year which would allow foreign banks to operate in India as wholly owned subsidiaries.

In addition to these measures, the Fed’s decision to delay the taper of its bond buying programme has provided some relief and strength to the currency.

Consumer Price Inflation y/y %

Source: MOSPI

GDP Consensus Forecast Revised Down

0

2

4

6

8

10

12

14

16

48

50

52

54

56

58

60

62

64

Jan-13 Mar-13 May-13 Jul-13

INR/USD y/y %

INR/USD (RHS)

Source: MOSPI


The MNI India Consumer Indicator declined for the fourth consecutive month in September, to the lowest level since the series started in November 2012.

Indicators


The MNI India Consumer Indicator declined for the fourth consecutive month in September, to the lowest level since the series started in November 2012.

The decline was led by a sharp fall in the percentage of consumers who felt it was a good time to buy a large household item, likely due to the current economic uncertainty India has been facing.

The Consumer Indicator fell to 115.9 in September from 118.7 in August, nearly 9.0% down since the start of the year. Sentiment has trended downwards since November and has only posted rises in two months, April and May.

Four out of five components which contribute to the India Consumer Indicator fell in September, with Durable Buying Conditions leading the decline. Current Personal Finances was the only indicator to rise in September.

Both current and future measures of confidence posted record lows in September. While the current indicator decreased 4.0% on the month to 109.3 from 113.9 in August, the future indicator fell 1.4% to 120.3 from 122.0. The Expectations Indicator has decreased for three months in a row while the Current Conditions has fallen in the last two months.

A 1.4% monthly increase in the Current Personal Finances indicator was offset by a sharp decline in the Durable Buying Conditions indicator which fell 9.7% on the month to 100.7 in September, the

115.9MNI India Consumer Indicator Falls to lowest on record in September


Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13

MNI India Consumer Indicator 119.7 123.9 124.5 122.9 119.5 118.7 115.9

Current 116.8 119.5 120.7 113.7 114.1 113.9 109.3

Expectations 121.6 126.8 127.0 129.0 123.0 122.0 120.3

100

110

120

130

140

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13


100

105

110

115

120

125

130

135

140

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Consumer Indicators

Current

Expectations


115.9

109.3

120.3

Total Indicator Current Indicator Expectations Indicator

All India

129.0

126.0

130.9


South India

111.0

105.2

114.9


North India

114.0

101.6

122.2


East India

112.6

110.6

114.0


West India

117.7

107.8

124.3


Central India


largest monthly drop on record and the lowest level since the series started.

All three components of the Expectations Indicator deteriorated in September contributing to the overall decline in consumer confidence. Expected Personal Finances led the fall, contracting 3.0% on the month to a record low of 118.4 in September from 122.1 in August. Business Conditions in a Year also hit a series low of 114.1, down 1.0% from August. Expectations for Business Conditions in five years‘ time remained broadly stable at 128.4 compared with 128.5 previously.

RegionsThe fall in the MNI India Consumer Indicator was led by a sharp decline in consumer confidence in the East India region where the total indicator posted a monthly drop of 9.1% to 114.0 in September, the lowest since the series began in November 2012. Smaller falls were seen in the Central and West India regions.

While consumer confidence worsened in East, West and Central India, it improved in South and North India. Confidence in South India was higher than in the other four regions, with the total indicator posting a monthly gain of 4.2% to 129.0 in September. Since the series began late last year, average confidence in South India has been the strongest of all the regions and 6.4% above the average for the whole of India.

Among the top ten cities covered in the survey, consumer confidence improved only in Mumbai, Bangalore and Hyderabad. Consumer sentiment deteriorated sharply in Surat, Pune and Kolkata. In Delhi, the total indicator fell 4.1% on the month to 107.9 in September.

0.3

-0.6

-0.2

0.0

-1.9

Personal Finances: Current

Personal Finances: Expected

Business Conditions: 1 Year

Business Conditions: 5 Year

Durable Buying Conditions

Consumer Indicator: Contribution to Monthly Change (% pt.)


AgeConsumer sentiment worsened in the youngest and oldest of the three main age groups and remained stable for the 35-54 age range.

The overall Consumer Indicator for the 18-34 age range fell 2.2% to 118.5 in September, while confidence for the 55-64 age dropped sharply to 111.0 in September from 117.2 in August, a 5.3% decline on the month. For the 35-54 age range, the indicator remained broadly stable at 117.4 compared with 117.2 previously.

Since data including a breakdown on age started in December last year, confidence has been highest among 18-34 year olds and weakest for the 55-64 age range.

In September, all age ranges reported lower readings for the Current Indicator while the Expectations Indicator improved only for the 35-54 age grouping.

IncomeConsumer confidence worsened in broadly equal measure in both low and high income households. The Consumer Indicator for households with an average income of over INR 432,000 per annum decreased 1.4% on the month to 119.3 in September, while for households with an average annual income under INR 432,000 the indicator fell 0.9% on the month to 117.3 in September.

Since data on income became available in February, confidence has fallen 6.7% in higher income households compared with a fall of 2.6% in lower income households, although on average the level of confidence has been greater in high income households.

115.9

118.5

117.4

111.0

All 18-34 35-54 55-64

Consumer Indicator: Age Groups


117.3

111.7

121.0

Total Current Expected

< INR 432,000

119.3

112.1

124.2

Total Current Expected

> INR 432,000

MNI India Consumer IndicatorIncome Groups


MNI India Consumer IndicatorMain Cities

The Consumer Indicator fell in seven out of the ten major cities of India, but the indicator remained above the 100 breakeven in all of them. Consumer sentiment improved only in Mumbai, Bangalore and Hyderabad, while it deteriorated sharply in Surat, Pune and Kolkata.

Chennai was the most optimistic city with the Consumer Indicator standing at 149.6 in September, a rise of 15.0% since the series started in November 2012. In contrast, Bangalore was the least optimistic, with confidence at just 103.0, a fall of 23.1% over the same period.

In the capital, Delhi, the overall Consumer Indicator fell 4.1% on the month to 107.9 in September driven by a sharp 20.6% decline in the Durable Buying Conditions Indicator. That was partially offset by a rise in Current Personal Finances and the indicator measuring Business Conditions in a Year.

Current conditions for Delhi decreased 8.8% to 101.4 in September from 111.3 in August, while the Expectations Indicator declined 1.1% to 112.2 as expectations regarding personal finances deteriorated.

In Mumbai, India‘s most populous city, consumer sentiment improved slightly with the indicator rising to 113.3 in September from 112.1 in August. A large fall in Durable Buying Conditions and a slight fall in the Business Conditions Indicator in Five Years were offset by a rise in each of the other three components of the Consumer Indicator.

Mumbai saw a 6.1% drop in the Current Indicator which fell below the 100 breakeven level to 98.3 in September. The decline was more than offset by a 5.4% rise in the Expectations Indicator to 123.3.

Having trended upwards at the start of the year, overall confidence in Mumbai has eased since May, with the Consumer Indicator falling from an average

100

105

110

115

120

125

130

135

140

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Consumer Indicator - Mumbai

98.3

123.3

105.6

122.2 120.0127.8

91.1

CurrentIndicator

ExpectationsIndicator

PersonalFinances:Current

PersonalFinances:Expected

BusinessConditions: 1

Year


Year

DurableBuying

Conditions

Consumer Indicator Components - Mumbai

of 131.0 in the first five months of the year to an average of 114.9 from June to September.

In Bangalore, the third largest city by population in India, the Consumer Indicator improved slightly in September to 103.0 from 100.2 in August, but remained well below the peak of 145.8 seen in June,


100

105

110

115

120

125

130

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Consumer Indicator - Delhi

80

90

100

110

120

130

140

150

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Consumer Indicator - Bangalore

101.4

112.2

104.8107.7

111.5

117.3

98.1

CurrentIndicator





Year


Year

DurableBuying

Conditions

Consumer Indicator Components - Delhi

89.5

112.0

95.0 94.0

113.0

129.0

84.0

CurrentIndicator





Year


Year

DurableBuying

Conditions

Consumer Indicator Components - Bangalore

having fallen sharply over the past three months. A rise of 13.5% in the Expectations Indicator more than offset a 12.6% decline in the Current Indicator. Like Mumbai, the Current Indicator fell below 100 to 89.5 while the Expectations Indicator remained above 100 at 112.0 in September.


Survey respondents reported an improvement in their current financial situation in September, although expectations for the future declined to a record low amid growing concerns about the state of the economy. The Current Personal Finances Indicator, which measures whether the financial situation of a household is better, the same or worse than a year ago, has improved a little in the past two months, rising to 118.0 in September, from 116.3 in August.

While the measure remained above 100, indicating a higher proportion of respondents see their financial situation as better as opposed to worse, optimism is well down from the 133.9 outturn seen at the start of the year but at the highest since May. On a quarterly basis confidence has trended down to 116.2 in the three months to September from 119.7 in the previous quarter and below the 124.7 seen in the three months to January.

Respondents cited a higher income level as the main reason behind the improvement in their current financial situation in September, while increased family expenses was the main reason behind worsening financial conditions.

Expected Personal Finances, which measures whether households think their finances will be better in a years’ time, have fallen since the peak in April. In September there was a further decline of 3% on the month to 118.4 from 122.1 in August, the lowest level since the series began in November 2012 and below the three month average of 120.8.

118.0Personal Finances Current Finances Post Small Rise

Personal Finances


Current 116.6 121.1 122.2 115.8 114.2 116.3 118.0

Expectations 124.0 131.8 131.0 128.3 121.9 122.1 118.4

100

110

120

130

140

150

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Personal Finances

Current

Expectations

6.2

36.9

44.3

12.1

0.6

Current Financial Situation Compared with 1 Year Ago (% of Households)

Much Better

A Little Better

Same

A Little Worse

Much Worse


2.6

5.0

21.8

70.6

Daily Expenses (% of Households)

13.1

76.4

8.7

1.8

Monthly Household Income Used for Savings (% of Households)

72.1

19.7

6.7

1.5

Monthly Household Income Used for Large Loan Repayment (% of Households)

51.647.3

1.0

0.2

Monthly Household Income Used for Investments(% of Households)

How Households Spend their Money

0% - 29% of Income

30% - 49% of Income

0% of Income

1% - 29% of Income

0% of Income

1% - 29% of Income

0% of Income

1% - 29% of Income

50% - 69% of Income

70% - 100% of Income

30% - 49% of Income


30% - 49% of Income


30% -49% of Income


w

Perceptions about the current and future state of business worsened further in September.

The Current Business Conditions Indicator, which measures respondents’ views on the state of business compared with a year earlier, fell 2.3% on the month to 108.9 in September.


Perceptions about the current and future state of business worsened further in September, as concerns about the state of the economy intensified.

Recent economic news has done little to lessen the economic gloom surrounding India. Slow economic growth, the fall in the rupee, stubborn inflation and high fiscal and current account deficits, all continue to plague India. The Reserve Bank of India also hiked the policy interest rate to 7.5% on September 20, although this came after the September survey data had been collected.

The Current Business Conditions Indicator, which measures respondents’ views on the state of business compared with a year earlier, fell 2.3% on the month to 108.9 in September, the lowest since the series began in November 2012. While it remained above the 100 breakeven level, it has been on a downward trend since its inception.

The partial recovery of the Current Business Conditions Indicator seen in April and May was followed by four consecutive falls as a lower proportion of respondents said they believed that business conditions were “good”, while a higher proportion of respondents said current business conditions were only “fair“. In addition, since June more respondents have replied that business conditions were poor.

Expectations for Business Conditions in a Year also worsened further, with the indicator falling for three consecutive months down to 114.1 in September from 115.3 in August, as more respondents reported

108.9Current Business Conditions IndicatorAt Record Low

Business Conditions


Current 116.4 120.0 121.0 118.4 113.1 111.4 108.9

In 1 Year 114.9 117.2 119.4 124.2 121.2 115.3 114.1

In 5 Years 126.0 131.6 130.5 134.6 126.0 128.5 128.4

100

105

110

115

120

125

130

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Current Business Conditions Indicator

100

110

120

130

140

150

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Expected Business Conditions: 1 Year and 5 Years

1 Year

5 Years


Business Conditions in 1 YearSelected Reasons

Government/Policy

Econ. Development

Income/Employment

Resource/Environment

Social Stability/ Security

Events

Government/Policy

Econ. Development

Income/Employment



Events

Government Economics Events Income Resources Security

All India, Reasons for Better

Government Economics Events Income Resources Security

All India, Reasons for Worse

50.6%48.4%

22.7%31.7%

Aug-13 Sep-13

All Indiabusiness conditions will be the same, rather than better.

Longer term, Expectations for Business Conditions in Five Years remained broadly stable, standing at 128.4 in September compared with 128.5 in August. In the quarter ending September, however, expectations for the next five years fell to 127.6 from 132.2 in the previous quarter.

Both Current Business Conditions and Expectations in a Year posted the lowest readings on record.

The fall in the Current Business Conditions Indicator is consistent with the September downturn in the MNI India Business Indicator, which fell to 59.4 in September from 64.0 in the previous month, possibly because more companies reported the exchange rate is hurting their business.

Better

Worse


Business Conditions in 1 YearRegions

109.9

124.0

118.3

107.2

118.0

North India South India East India West India Central India

Business Expectations


Reasons for Better (% of Respondents)

39.9%

18.9%

47.1% 50.0%

29.8%

60.1%

81.1%

52.9% 50.0%

70.2%


Business Expectations: Worse or Better?(% of Respondents)


Reasons for Worse (% of Respondents)

Worse

Better

Government/Policy

Econ. Development

Income/Employment



Events

Government/Policy

Econ. Development

Income/Employment



Events


The Indicator on Durable Buying Conditions, which measures whether respondents think it is a good time or bad time to buy a large household good, fell sharply in September to its lowest level since the series began in November 2012.

The fall in September to 100.7, left the indicator just above the breakeven 100 level, but down 9.7% from the previous month and almost 17% below the outturn in November 2012. This was the second consecutive monthly drop in the indicator.

Recent official data has highlighted the continued weakness in the economy. GDP growth slowed to 4.4% in the April-June quarter compared with the same period last year, the slowest growth since 2009. Concerns over the immediate future of the economy are likely to have impacted consumers’ buying patterns.

Survey participants saying it was an “excellent time” or “good time” to buy large household durables totalled 28.5% in September, down from 40.9% in August, while the proportion of those saying it was a “bad time” or “very bad time” rose to 26.4% in September from 17.6% in August. Those responding “no change” totalled 45.1%, up from 41.5% in August.

Durable Buying Conditions Falls Sharply to Record Low



Durable Buying Conditions 117.1 117.9 119.2 111.6 114.0 111.5 100.7

100.7

95

105

115

125

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13


0.5

28.0

45.1

25.4

1.1

Is It a Good or Bad Time to Buy Large Household Goods? (% of Households)

Excellent Time

Good Time

Neutral

Bad Time

Very Bad Time

Don‘t Know/No Answer


The Employment Indicator fell sharply in September, declining to the lowest level since February, led by declines in the East, West and Central regions.

The indicator, which measures opinion on the outlook for the employment market over the next 12 months, fell to 113.2 in September from 119.2 in August. Survey participants forecasting an improvement in employment totalled 42.8% in September, down from 51.6% in August, while the proportion of those forecasting a worsening rose to 18.2% in September, up from 15.8% in the previous month. Those suggesting there would be no change rose to 39.1% from 32.6% in August.

The index has been above the breakeven 100 since the series started in November 2012, but on a falling trend since May this year.

Employment Outlook IndicatorLowest since February

Employment Outlook


Employment Outlook 119.1 123.4 127.9 122.6 120.9 119.2 113.2

100

105

110

115

120

125

130

135

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Employment Outlook Indicator

3.6

39.1

39.1

16.31.9

Employment Outlook for the Next 12 Months (% of Households)

113.2

Much Better

A Little Better

Same

A Little Worse

Much Worse


w

Consumer price inflation remained sticky at 9.5% on the year in August.

Concerns over inflation intensified in September as respondents became increasingly concerned about the current level of prices and expectations for the future hit a series high.


Concerns over inflation intensified in September as respondents became increasingly concerned about the current level of prices and expectations for the future hit a series high.

The Satisfaction with Current Prices Indicator fell to 83.2 in September, down 10.1% from the 92.6 rea-ding in August. A figure below 100 indicates wider dissatisfaction with current prices, and the further be-low 100 the greater the dissatisfaction. The indicator has been above 100 in only November and December of last year.

Consumer price inflation remained sticky at 9.5% on the year in August, down only slightly from July’s 9.6%. Food prices have increased noticeably in re-cent months, with vegetable prices rising by an alar-ming 26.5% on the year in August, boosted by the surging price of onions, a key item in Indian househol-ds. Food accounts for around half of the basket of goods and services in the consumer price index.

The Inflation Expectations Indicator, which measures whether respondents think prices will be higher or lo-wer in 12 months’ time, rose to 156.1 in September compared with 152.9 in July, the highest since the series was formed in November 2012.

The percentage of respondents who believed prices would be higher in a years’ time accounted for 93.3% in September, up from 86.1% in August, while those saying prices would be unchanged fell to 5.8% from 11.5%. Respondents who forecast prices would be lower dropped to 0.9% from 2.4%.

Prices SentimentFurther Dissatisfaction with Prices

Prices Sentiment


Satisfaction with Current Prices 78.2 96.5 99.7 96.4 93.9 92.6 83.2

Inflation Expec-tations 145.6 134.0 136.5 143.9 144.4 152.9 156.1

60

70

80

90

100

110

120

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Current Prices Satisfaction

110

120

130

140

150

160

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Inflation Expectations Indicator

83.2


2.7

29.9

14.9

36.1

16.4

Satisfaction with Prices (% of Households)

Very Satisfied

Quite Satisfied

So So

Not Very Satisfied

Not Satisfied At All


19.9

73.4

5.8

0.7 0.2

Inflation Expectations in 12 Months (% of Households)

Much Higher

A Little Higher

Same

A Little Lower

Much Lower


Asked about how much prices would rise over the next year, a high proportion of respondents in Sep-tember thought that prices could rise up to 10.0%, down from last month, when a high proportion of re-spondents thought that prices could rise up to 11.0%-24.0% over the next year.

Regions All five regions showed dissatisfaction with the current level of prices, with West India showing the highest level of discontent. Both North India and West India showed large falls in dissatisfaction compared with August when they were around the 100 breakeven level.

The increase in inflation expectations over the next 12 months between August and September was driven by North, South and West India. Both East and Cen-tral India saw a decline in the Inflation Expectations Indicator, although it remained well above the break-even 100 level.

Prices SentimentRegions


83.275.5

97.9

76.2 75.2

93.4

All India North India South India East India West India CentralIndia

Current Prices Indicator Satisfaction

156.1156.7

152.1

157.1156.3

151.6


Inflation Expectations Indicator


Satisfaction with Prices (% of Households)

Very Satisfied

Quite Satisfied

Neutral

Not Very Satisfied

Not Satisfied At All



Expected Change in Prices in 1 Year(% of Households)

Much Higher

A Little Higher

Same

A Little Lower

Much Lower



Survey participants expected interest rates to continue to increase over the coming year, and at an increased pace than in August.

The Interest Rate Expectations Indicator rose to 136.1 in September, up from 133.8 in August and the highest since November last year when the series started. There was a significant rise in the percentage of respondents who thought rates would be “a little higher” in a years’ time, while the number of people who thought rates would be “much higher” dropped compared with August.

The rise in the indicator since June possibly reflected expectations that the central bank would need to tighten monetary policy in response to the weakness in the currency.

The Reserve Bank of India hiked the key policy rate to 7.5% from 7.25% on September 20, citing the high level of inflation expectations. The rise would not have had an impact on our data as it came after the survey window had closed.

Survey participants forecasting interest rates on home and car loans would be higher in a year accounted for 64.9% in September, up from 59.3% in August. Those forecasting lower rates fell to 6.4% in September, down from 7.5% in August. The percentage of respondents responding that interest rates would remain the same stood at 28.5%.

Interest Rate Expectations IndicatorRates Expected to Rise

Expected Interest Rate


Expected Interest Rate 116.6 123.0 125.6 120.4 129.6 133.8 136.1

136.1

100

110

120

130

140

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Interest Rate Expectations Indicator

14.0

50.9

28.5

6.0

0.4

Expected Change in Interest Rate in 1 year (% of Households)

Much Higher

A Little Higher

Same

A Little Lower

Much Lower


The Stock Investment Indicator rose in September to its highest level since June, as investors reported higher returns over the past twelve months.

The indicator rose 1.8% on the month to 106.4 in September, up from 104.6 in August, having peaked at 110.1 in June. The Investment Sentiment Indicator is composed of three components; Investment Return, Stock Price Sentiment and Stock Market Expectation.

In September, Stock Price Sentiment, which measures whether respondents view equity prices as high or low, rose to 124.8, up from 116.5 in August the highest reading since February when the series started. The component has a negative impact on the overall investment indicator.

The Stock Investment Return component rose to 125.2 in September, up from 111.1 in August, indicating respondents have made greater returns on their investments over the past 12 months.

Survey participants saying stock prices were “Expensive” totalled almost 53.0% in September, up from 47.6% in August, while the proportion of those saying they were “Cheap” fell to 8.5% from 18.0% in August. Those saying prices were “Just right” rose to 27.4%, up from 18.9% in August.

Expectations for stock prices in three months’ time decreased slightly to 118.8 in September from 119.2 in August.

Stock Investment IndicatorHigher Returns Improve Sentiment

Investment Sentiment


Investment Sentiment Indicator 104.5 102.3 101.4 110.1 105.1 104.6 106.4

Investment Return 110.1 105.1 104.0 102.7 112.7 111.1 125.2

Stock Price Sentiment 104.2 103.7 103.5 100.4 111.9 116.5 124.8

Stock Market Expectation 107.5 105.5 103.8 127.8 114.6 119.2 118.8

90

95

100

105

110

115

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Stock Investment Indicator

1.09

0.65

-0.03

Investment Return Stock Price Sentiment Stock MarketExpectation

Stock Investment Indicator: Contribution to Monthly Change (% pt.)

106.4


106.4

125.2 124.8

118.8

InvestmentIndicator

Investment Return Stock PriceSentiment

Stock MarketExpectation

Stock Investment Indicator - Components

90

95

100

105

110

115

120

125

130

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Stock Price Sentiment

90

100

110

120

130

140

150

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Investment Return

90

95

100

105

110

115

120

125

130

135

140

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Stock Market Expectation

Stock Investment IndicatorRegions and Components


103.3

133.3125.0

105.0113.9


Stock Investment Indicator - Regions


Expected Change in the Stock Market in the next 3 Months (% of Households)

Go Up Dramatically

Go Up Slightly

Stay the Same

Gow Down Slightly

Go Down Sharply


MuchHigher

A LittleHigher

About thesame

A LittleLower

MuchLower

Don't Know

Stock Market Expectation (% of Households)

w

The Real Estate Investment Indicator slipped to a new record low in September...

... in spite of a growing expectation that prices will increase in the future.


The Real Estate Investment Indicator slipped to a new record low in September, in spite of a growing expectation that prices will increase in the future.

The indicator fell slightly to 109.7 in September from 109.8 in August, having averaged around 115.5 in the previous six months.

The Real Estate Investment Indicator is composed of three sub-indicators to gauge sentiment on the housing market; House Price Expectations, House Buying Sentiment and House Selling Sentiment.

House Price Expectations rose to 144.7 in September, up from 140.8 in August, posting the highest reading since February when the series started. A value above 100 indicates more people expect prices to increase in the next six months.

The percentage of respondents who said prices will go up in the next six months stood at 68.2% in September, while those saying prices would go down totalled 4.8%. Those who said prices would “Stay the same” stood at 24.3% while 2.7% were not sure or did not respond in September.

House Buying Sentiment, a measure of whether it is a good time in the next six months to buy a house, fell to 98.1 in September, down from 100.6 in August, the lowest reading since November when the series started, possibly due to the uncertain economic environment.

Real Estate Investment Indicator Falls to New Record Low

Real Estate Investment Sentiment


Real Estate Invest-ment Sentiment 119.4 119.9 113.1 115.7 115.1 109.8 109.7

Price Expectations 142.4 139.1 133.3 136.3 135.1 140.8 144.7

House Buying 118.1 121.5 115.5 119.7 114.7 100.6 98.1

House Selling 102.2 101.1 109.4 109.0 104.4 111.9 113.6

109.7

100

105

110

115

120

125

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Real Estate Investment Indicator

1.19

-0.78

-0.51

Price Expectation House Buying House Selling

Real Estate Investment Indicator: Contribution to Monthly Change (% pt.)


105

110

115

120

125

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Real Estate Prices: Expected Changes in Next 6 Months

140.8

100.6111.9 109.8

144.7

98.1

113.6 109.7

Price Expectation House Buying House Selling Indicator

Real Estate Investment Indicator - Components

All India North South East West

Expected Changes in Real Estate Prices in the Next 6 months (% of Households)

Real Estate Investment IndicatorComponents and Balances

House Selling Sentiment is a measure of whether it is a good time in the next six months to sell a house and has a negative impact on the overall Real Estate Investment Indicator. The Indicator rose to 113.6 in September, from 111.9 in August, the highest reading since the series began in November.

RegionIn September, the Real Estate Investment Indicator remained stable in North, East and West India. South India showed an improvement in the Indicator due to a rise in House Buying Sentiment, while Central India posted a small drop due to a rise in House Selling Sentiment.

August 2013

September 2013

Go Up Dramatically

Go Up Slightly

Stay the Same

Gow Down Slightly

Go Down Sharply



90

100

110

120

130

140

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

House Buying Sentiment

90

100

110

120

130

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

House Selling Sentiment

17.8

2.2

7.4

4.9

2.0

1.0

Reasons for Buying Houses (% of Households)

5.0

30.0

48.5

10.1

1.3

5.1

Timing for Selling Houses (% of Households)

Excellent Time

Good Time

Neutral

Bad Time

Very Bad Time


Prices

Income/Purchasing Power

Invetsment Value

Policy/Interest Rate

Supply and Quality

Others


The climate for buying a car was the worst since the survey began in November 2012, underlying the concerns consumers have about the current economic situation.

The Car Purchase Indicator fell to 60.1 in September from 61.6 in August. The indicator has fallen 16% since the start of the year.

The Overall Car Purchase Sentiment Indicator is made up of two components, Car Purchase Expectations and Price of Gasoline Expectations.

The Car Purchase Expectations component, which measures the willingness to buy a car, stood at 90.3 in September, down from 94.3 in August, and the lowest since the series started in November 2012.

The Indicator on Gasoline Prices, which measures the expectations for the price of gasoline in a year, remained stable at 170.2 in September compared with 171.0 in August, although was 3.8% higher than in January. Increasing gasoline prices have a negative impact on the overall Car Purchase Indicator.

Survey participants forecasting gasoline prices would go up totalled 89.2% September, down from 91.1% in August, while the proportion of those saying they would go down fell to 1.5% in September from 2.3% in August.

Car Purchase Indicator Lowest on Record

50

60

70

80

90

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Car Purchase Indicator

80

90

100

110

120

130

140

150

160

170

180

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Car Purchase Indicator - Components

Car Purchase

Price of Gasoline

Car Purchase Sentiment


Car Purchase Sentiment 76.6 76.4 75.8 69.5 68.5 61.6 60.1

Car Purchase 107.3 109.2 106.0 98.5 105.7 94.3 90.3

Price of Gasoline 154.0 156.4 154.5 159.5 168.7 171.0 170.2

60.1


Car Purchase IndicatorRegions

11.6 11.5

25.0

6.3 6.3

13.1

All India North South East West Central

Is It a Good Time to Buy a Car? (% of Respondents)


Reasons for a Bad Time to Buy a Car(% of Households)

Prices



Supply and Quality

Cost of Use/Upkeep

Others

Reasons for a Good Time to Buy a Car(% of Households)


Prices



Supply and Quality

Cost of Use/Upkeep

Others

52.5

36.7

3.7

1.5

5.6

Expected Change in the Price of Gasoline (% of Households)

Go Up Dramatically

Go Up Slightly

Stay the Same

Gow Down Slightly

Go Down Sharply



MNI India Consumer Indicator Regions

105.2114.9 112.0 114.9

109.9120.0

98.3

CurrentIndicator


PersonalFinance:Current

PersonalFinance:Expected

BusinessCondition: 1

Year


Year

DurableBuying

Conditions

Consumer Indicator Components: North India

100

110

120

130

140

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Consumer Indicator: North India

126.0 130.9136.5

128.1 124.0

140.6

115.6

CurrentIndicator





Year


Year

DurableBuying

Conditions

Consumer Indicator Components: South India

110

120

130

140

150

160

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Consumer Indicator: South India


101.6

122.2116.7 113.5 118.3

134.9

86.5

CurrentIndicator





Year


Year

DurableBuying

Conditions

Consumer Indicator Components: East India

100

110

120

130

140

150

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Consumer Indicator: East India

110.6 114.0120.7

114.9107.2

119.8

100.5

CurrentIndicator





Year


Year

DurableBuying

Conditions

Consumer Indicator Components: West India

110

120

130

140

150

160

Nov

-12

Dec

-12

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Consumer Indicator: West India



Employment Indicator Outlook for the Next 12 Months (% of Households)

138.7

146.9

139.7

131.1

144.3


Interest Rates Expectations Indicator

Much Better

A Little Better

About the Same

A Little Worse

Much Worse


107.8

124.3117.2 117.2 118.0

137.7

98.4

CurrentIndicator





Year


Year

DurableBuying

Conditions

Consumer Indicator Components: Central India

100

110

120

130

140

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Consumer Indicator: Central India


112.0

136.5

116.7 120.7 117.2


Personal Finances - Current


Stock Investment Expectations Indicator: Contributions to Monthly Change (% pt.)


Interest Rates Expectations Indicator (% of Households)

Investment Return

Stock Price Sentiment

Stock Market ExpectationMuch Higher

A Little HIgher

About the Same

A Little Lower

Much Lower



MNI India Consumer Indicator Income Groups

119.7 120.7112.5

129.9

103.8




Year


Year

DurableBuying

Conditions

< INR 432,000 - Components

118.3

113.8

121.3

117.3

111.7

121.0

< INR 432,000 < INR 432,000 -Current Indicator

< INR 432,000 -Expectations Indicator

< INR 432,000

123.6 119.4 117.4

135.7

100.6




Year


Year

DurableBuying

Conditions

> INR 432,000 - Components

121.1

117.8

123.2

119.3

112.1

124.2

> INR 432,000 > INR 432,000 -Current Indicator

> INR 432,000 -Expectations Indicator

> INR 432,000

August 2013

September 2013

August 2013

September 2013

Spitzzeile Titel 51

A closer look at the data behind the MNI India Consumer Sentiment.

Data Tables


North India Overview


Since Lowest


Monthly Change

Monthly % Change

MNI India Consumer Indicator 114.3 108.2 111.0 Jul-13 - 111.2 2.8 2.6%

Current Indicator 103.1 104.3 105.2 Jun-13 - 104.2 0.9 0.8%

Expectations Indicator 121.7 110.7 114.9 Jul-13 - 115.8 4.2 3.8%


Personal Finance: Expected 123.6 108.6 114.9 Jul-13 - 115.7 6.3 5.8%

Business Condition: 1 Year 115.4 103.6 109.9 Jul-13 - 109.6 6.3 6.1%

Business Condition: 5 Year 126.2 120.1 120.0 - May-13 122.1 -0.1 -0.1%


Current Business Conditions Indicator 107.6 97.2 103.8 Jul-13 - 102.9 6.6 6.8%

Stock Investment Indicator 116.7 102.5 103.3 Jul-13 - 107.5 0.8 0.8%



Employment Outlook Indicator 115.2 106.1 107.2 Jul-13 - 109.5 1.1 1.1%

Inflation Expectations Indicator 147.4 148.5 156.7 Series High - 150.9 8.3 5.6%

Current Prices Satisfaction Indicator 87.7 106.6 75.5 - May-13 89.9 -31.1 -29.2%

Interest Rates Expectations Indicator 128.5 126.6 138.7 Series High - 131.3 12.1 9.5%


South India Overview


Since Lowest


Monthly Change

Monthly % Change

MNI India Consumer Indicator 126.9 123.8 129.0 Jun-13 - 126.5 5.1 4.2%

Current Indicator 129.5 121.4 126.0 Jul-13 - 125.7 4.6 3.8%

Expectations Indicator 125.1 125.4 130.9 Jun-13 - 127.1 5.5 4.4%

Personal Finance: Current 139.9 128.6 136.5 Jul-13 - 135.0 7.9 6.1%

Personal Finance: Expected 117.2 123.8 128.1 Jun-13 - 123.0 4.3 3.5%


Business Condition: 5 Year 111.6 122.6 140.6 Jun-13 - 125.0 18.0 14.7%

Durable Buying Conditions 119.2 114.3 115.6 Jul-13 - 116.4 1.3 1.2%

Current Business Conditions Indicator 131.8 119.0 127.1 Jul-13 - 126.0 8.0 6.8%

Stock Investment Indicator 100.0 83.3 133.3 Series High - 105.6 50.0 60.0%

Real Estate Investment Indicator 95.3 103.1 118.6 May-13 - 105.7 15.6 15.1%

Car Purchase Indicator 75.5 63.1 78.1 Jun-13 - 72.2 15.0 23.8%

Employment Outlook Indicator 135.4 122.6 130.2 Jul-13 - 129.4 7.6 6.2%

Inflation Expectations Indicator 139.9 151.2 152.1 Mar-13 - 147.7 0.9 0.6%

Current Prices Satisfaction Indicator 137.9 90.5 97.9 Jul-13 - 108.8 7.4 8.2%

Interest Rates Expectations Indicator 148.0 148.8 146.9 Jun-13 - 147.9 -1.9 -1.3%


East India Overview


Since Lowest


Monthly Change

Monthly % Change




Personal Finance: Current 120.8 128.3 116.7 - Nov-12 121.9 -11.6 -9.0%


Business Condition: 1 Year 116.9 120.3 118.3 - Jul-13 118.5 -2.0 -1.7%

Business Condition: 5 Year 136.0 133.3 134.9 - Jul-13 134.7 1.6 1.2%


Current Business Conditions Indicator 105.1 114.5 111.1 - Jul-13 110.2 -3.4 -3.0%

Stock Investment Indicator 100.0 125.0 Series High 112.5 25.0 25.0%

Real Estate Investment Indicator 109.9 109.2 108.5 - May-13 109.2 -0.8 -0.7%


Employment Outlook Indicator 128.1 123.9 116.7 - Jun-13 122.9 -7.2 -5.8%

Inflation Expectations Indicator 146.1 162.3 157.1 - Jul-13 155.2 -5.2 -3.2%

Current Prices Satisfaction Indicator 83.1 76.1 76.2 - Jul-13 78.5 0.1 0.1%

Interest Rates Expectations Indicator 132.6 142.0 139.7 - Jul-13 138.1 -2.3 -1.7%


West India Overview


Since Lowest


Monthly Change

Monthly % Change

MNI India Consumer Indicator 118.0 116.6 112.6 - Feb-13 115.7 -4.0 -3.4%

Current Indicator 109.7 109.8 110.6 May-13 - 110.0 0.8 0.7%


Personal Finance: Current 104.3 116.1 120.7 Apr-13 - 113.7 4.6 4.0%



Business Condition: 5 Year 126.7 127.7 119.8 - Jan-13 124.7 -7.9 -6.2%

Durable Buying Conditions 115.1 103.6 100.5 - Jun-13 106.4 -3.1 -3.0%

Current Business Conditions Indicator 107.8 110.3 100.9 - Series Low 106.3 -9.4 -8.5%

Stock Investment Indicator 111.1 112.5 105.0 - May-13 109.5 -7.5 -6.7%

Real Estate Investment Indicator 118.3 108.0 108.5 Jul-13 - 111.6 0.5 0.5%

Car Purchase Indicator 61.6 62.9 53.4 - Jan-13 59.3 -9.6 -15.2%

Employment Outlook Indicator 114.7 119.6 105.9 - Mar-13 113.4 -13.8 -11.5%

Inflation Expectations Indicator 144.8 149.1 156.3 Jan-13 - 150.1 7.2 4.8%

Current Prices Satisfaction Indicator 84.5 100.9 75.2 - Series Low 86.9 -25.7 -25.4%

Interest Rates Expectations Indicator 123.3 130.8 131.1 Feb-13 - 128.4 0.3 0.2%


Central India Overview


Since Lowest


Monthly Change

Monthly % Change



Expectations Indicator 120.4 131.0 124.3 - Jul-13 125.3 -6.7 -5.1%

Personal Finance: Current 112.3 121.1 117.2 - Jul-13 116.8 -3.8 -3.2%





Current Business Conditions Indicator 105.7 121.1 107.4 - Jul-13 111.4 -13.7 -11.3%

Stock Investment Indicator 133.3 105.6 113.9 Jul-13 - 117.6 8.3 7.9%


Car Purchase Indicator 69.8 54.4 61.9 Jul-13 - 62.0 7.5 13.8%

Employment Outlook Indicator 129.2 128.9 109.8 - Series Low 122.7 -19.1 -14.8%

Inflation Expectations Indicator 145.3 157.9 151.6 - Jul-13 151.6 -6.3 -4.0%

Current Prices Satisfaction Indicator 85.8 84.2 93.4 Apr-13 - 87.8 9.2 11.0%

Interest Rates Expectations Indicator 115.1 144.7 144.3 - Jul-13 134.7 -0.5 -0.3%


All India Overview by Age


Since Lowest


Monthly Change

Monthly % Change

Age 18-34



Expectations Indicator 122.7 124.8 123.2 - Jul-13 123.6 -1.5 -1.2%

Personal Finance: Current 116.8 118.8 119.5 Jun-13 - 118.4 0.6 0.5%





Age 35-54

MNI India Consumer Indicator 119.9 117.2 117.4 Jul-13 - 118.2 0.2 0.1%

Current Indicator 113.4 112.8 111.3 - Jun-13 112.5 -1.5 -1.3%


Personal Finance: Current 113.3 115.2 121.3 Feb-13 - 116.6 6.1 5.3%

Personal Finance: Expected 121.9 120.1 119.4 - Mar-13 120.5 -0.7 -0.6%

Business Condition: 1 Year 123.9 114.8 116.0 Jul-13 - 118.2 1.2 1.1%



Age 55-64




Personal Finance: Current 111.6 114.9 114.6 - Jul-13 113.7 -0.4 -0.3%




Durable Buying Conditions 116.4 110.0 98.1 - Dec-12 108.2 -11.9 -10.8%


All India - Overview by Income


Since Lowest


Monthly Change

Monthly % Change

< INR 432,000

MNI India Consumer Indicator 116.9 118.3 117.3 - Jul-13 117.5 -1.0 -0.9%

Current Indicator 111.9 113.8 111.7 - Jun-13 112.5 -2.1 -1.9%

Expectations Indicator 120.2 121.3 121.0 - Mar-13 120.9 -0.3 -0.3%


Personal Finance: Expected 118.7 120.4 120.7 Jun-13 - 119.9 0.4 0.3%

Business Condition: 1 Year 121.6 114.0 112.5 - Mar-13 116.0 -1.5 -1.3%



> INR 432,000




Personal Finance: Current 123.4 119.6 123.6 Jun-13 - 122.2 4.0 3.3%


Business Condition: 1 Year 127.3 119.0 117.4 - Apr-13 121.2 -1.6 -1.4%




Methodology

The MNI India Consumer Sentiment Survey is a wide ranging monthly survey of consumer confidence across India.

Data is collected via telephone interviews. At least 1,000 interviews are conducted each month across the country.

The survey adopts a similar methodology to the University of Michigan survey of U.S. consumer sentiment.

The main MNI India Consumer Indicator is derived from five questions, two on current conditions and three on future expectations:

1) Current personal financial situation compared to a year ago2) Current willingness to buy major household items3) Personal financial situation one year from now4) Overall business conditions one year from now5) Overall business conditions for the next 5 years

Indicators relating to specific questions in the report are diffusion indices with 100 representing a neutral level, meaning positive and negative answers are equal. Values above 100 indicate increasing positivity while values below show increasing negativity.

Published byMNI Indicators | Deutsche Börse GroupWestferry House11 Westferry CircusLondon E14 4HEwww.mni-indicators.com

Copyright© 2013 MNI Indicators | Deutsche Börse Group. Reproduction or retransmission in whole or in part is prohibited except by permission. All rights reserved.

Date post:	06-May-2015
Category:	Economy & Finance
Upload:	mni-indicators-deutsche-boerse-group
View:	521 times
Download:	7 times

MNI India Consumer Report - September 2013

Economy & Finance