Mumbai, June 8 Consumer sentiment has bounced back in June with an upturn of 0.9 percentage points over May, according to the India Refinitiv-Ipsos Primary Consumer Sentiment Index (PCSI) for June 2022.

According to the report, consumer sentiment bounced back after the Centre slashed excise duty on petrol (by ₹8) and diesel (₹6) to cool inflation (on May 21)

Consumer sentiment had been weakening since April and May amid a hike in fuel prices owing to the Russia-Ukraine geopolitical crisis, impacting household spends, personal financial conditions and savings and investments for the future.  

The bounce-back has positively impacted sentiment for most sub-indices. The Investment Climate (“Investment”) Sub-Index is up 1 percentage points;  the PCSI Current Personal Financial Conditions (“Current Conditions”) Sub-Index rose 1.9 percentage points; the PCSI Economic Expectations (“Expectations”) Sub Index is equivalent to the last wave ; and the PCSI Employment Confidence (“Jobs”) Sub-Index is up 0.3 percentage points, over the previous month.

Amit Adarkar, CEO, Ipsos India, said, “Government sops to reduce fuel prices and to absorb the cost (forgoing approximately ₹1 lakh crore in tax revenue) has provided a reprieve to consumers and this is reflected in a rebound of consumer sentiment in June.”

“Particularly for personal financial conditions (for the day-to-day running of households) and investments (for savings and purchase of big ticket items). This bodes well for the economy, which has been sluggish due to the macro factors of the Ukraine War, pandemic impact and global slowdown,” said Adarkar.

“Consumer cheer is back and the sentiment around jobs is also seeing a revival. It is still a hard game and we could see consumer sentiment yo-yo due to the prolonged Ukraine war and increasing global inflation, as well as the impact of the RBI’s recent repo rate hike. WPI-based inflation continues to outpace CPI-based inflation, indicating that many manufacturers are not passing on the full impact of rising input prices to consumers in order to retain their growth trajectory. But this cannot last forever,” Adarkar added.

The report is based on the findings of an Ipsos online poll conducted from May 20, 2022–June 3, 2022. A sample of 500 adults aged 16-64, drawn from Ipsos India’s online panel, was interviewed for the survey.

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