Households Inflation Expectations Survey

Transcription

1 Households Inflation Expectations Today, the Reserve Bank released the results of the September 2017 round of the Inflation Expectations of Households (IESH) 1. The survey was conducted in 18 cities and the results are based on responses from 4,996 urban households covering various occupational categories (Table 1). Highlights: i. The proportion of respondents expecting general prices to increase in the next three months went up further in the September 2017 round relative to the previous round of the survey, with more than half of the respondents expecting prices to rise by more than the current rate (Table 2). ii. Expectations of higher inflation in the near term strengthened across all product groups (Table 2). iii. Similar sentiment prevailed in the case of one year ahead expectations as well (Table 2). iv. From quantitative responses, however, it bears out that the median inflation expectations for three months ahead and one year ahead softened by 30 and 60 basis points, respectively, as compared with the June 2017 round, and by 230 and 340 basis points, respectively, from the September 2016 round (Chart 1). Chart 1: Movements in Inflation Rates Inflation Rate (%) Sep-16 Mar-17 May-17 Jun-17 Sep-17 Current Perceived Rate Three Months ahead Expected Rate One Year ahead Expected Rate 1 The survey is conducted at regular intervals by the Reserve Bank of India. It provides useful directional information on nearterm inflationary pressures and also supplements other economic indicators. However, these expectations are formed by the respondents and may reflect their consumption pattern. Hence, it should not be treated as benchmarks for official measures of inflation. Page 1 of 5

2 Table 1: Respondents Profile (Category): Share in Total Sample - September 2017 Category of Respondents Share in Total (%) Target Share (%) Financial Sector Employees Other Employees Self-employed Housewives Retired Persons Daily Workers Others Table 2: Product-wise Expectations of Prices for Three Months ahead and One Year ahead (Percentage of Respondents) Sep- Mar- May- Jun- Sep- Sep- Mar- May- Jun- Sep Options: General Three Months Ahead One Year Ahead Prices will increase Price increase more than current rate Price increase similar to current rate Price increase less than current rate No change in prices Decline in prices Options: Food Product Three Months Ahead One Year Ahead Prices will increase Price increase more than current rate Price increase similar to current rate Price increase less than current rate No change in prices Decline in prices Options: Non-Food Product Three Months Ahead One Year Ahead Prices will increase Price increase more than current rate Price increase similar to current rate Price increase less than current rate No change in prices Decline in prices Options: Household Durables Three Months Ahead One Year Ahead Prices will increase Price increase more than current rate Price increase similar to current rate Price increase less than current rate No change in prices Decline in prices Options: Housing Prices Three Months Ahead One Year Ahead Prices will increase Price increase more than current rate Price increase similar to current rate Price increase less than current rate No change in prices Decline in prices Options: Cost of Services Three Months Ahead One Year Ahead Prices will increase Price increase more than current rate Price increase similar to current rate Price increase less than current rate No change in prices Decline in prices Page 2 of 5

3 Table 3: Households Expecting General Price Movements in Coherence with Movements in Price Expectations of Various Product Groups: Three Months Ahead and One Year Ahead (Percentage of Respondents) No. period ended Food Non-Food Households durables Housing Cost of services Three Months Ahead 45 Sep Mar B May Jun Sep One Year Ahead 45 Sep Mar B May Jun Sep Table 4: Household Inflation Expectations Current, Three Months and One Year Ahead Period Ended Inflation rate in Per cent 45 Sep Mar B May Jun Sep Table 5: Factors that Explain the Total Variability No. Period Ended 45 Sep-16 City, Age-Group City, Age-Group City 47 Mar-17 City, Age-Group City, Category City, Category 47B May-17 City, Gender, Category City, Category City, Category 48 Jun-17 City, Age-Group, Category City, Age-Group, Category City, Age-Group, Category 49 Sep-17 City, Gender, Category City, Age-Group, Category City, Gender, Category Page 3 of 5

4 Table 6 : Various Group-wise Inflation Expectations: September 2017 Overall Gender-wise Male Female Category-wise Financial Sector Employees Other Employees Self Employed Housewives Retired Persons Daily Workers Other category Age Group-wise Up to 25 years to 30 years to 35 years to 40 years to 45 years to 50 years to 55 years to 60 years years and above City-wise Ahmedabad Bengaluru Bhopal Bhubaneswar Chennai Delhi Guwahati Hyderabad Jaipur Kolkata Lucknow Mumbai Nagpur Patna Thiruvananthapuram Chandigarh Ranchi Raipur Page 4 of 5

5 Current Inflation Rate (per cent) Table 7: Cross-tabulation of Current and Three Months Ahead Inflation Expectations: September 2017 Three Months Ahead Inflation Rate (per cent) <1 1-<2 2-<3 3-<4 4-<5 5-<6 6-<7 7-<8 8-<9 (Number of Respondents) < < < < < < < < < < < < < < < < >= Total < < < < < < <16 >=16 No idea Total Current Inflation Rate (per cent) Table 8: Cross-tabulation of Current and One Year Ahead Inflation Expectations: September 2017 One Year Ahead Inflation Rate (per cent) <1 1-<2 2-<3 3-<4 4-<5 5-<6 6-<7 7-<8 8-<9 (Number of Respondents) < < < < < < < < < < < < < < < < >= Total < < < < < < <16 >=16 No idea Total Page 5 of 5