Economic Skepticism Starts to Recede
India consumer confidence appears to have rebounded after a month’s decline, according to a survey by Thomson Reuters and Ipsos.
September’s figures show the Primary Consumer Sentiment Index (PCSI) up 1.3 points from August, standing at 66.3 for September, 2015.
Looking further into the sub-indices that make up the PCSI, the growth seen in consumer confidence is strongly driven by perceptions of the current economic climate – up 1.5 points from August.
More modest gains are seen in perceptions of the current investment climate, a measure of how confident people feel in their ability to invest or save for the future (up 1 points), perceptions of job security 62.3 percentage points (remains the same as last month) and future economic expectations (up 1.5 points).
The figures show that the growing economic skepticism seen through the last month may have eased off as events such as the Greek debt crisis and slowdown in China became less prevalent in the media.
Amit Adarkar, Managing Director of Ipsos India, said: “The month of August saw a number of events that may have made Indians feel uncertain about both the global and Indian markets. As the Eurozone and Chinese stock market crises appear less frequently in the headlines the Indian public may be becoming more confident in the current and future economic climates.”
The Thomson Reuters/Ipsos PCSI measures 11 key indicators of consumer confidence and outlook as perceived by consumers – aged 16-64 – in the India. It has been providing aggregated global consumer sentiment data on a historical basis, since March 2010.
Survey Methodology
These are findings of an Ipsos online poll conducted August 21 to September 4, 2015. For this survey, a sample of 500 adults from Ipsos’ India online panel aged 16-64 was interviewed online. As this is an online poll in India, representative of the online community in the country, it is not reflective of the general population; however, the online sample in is particularly valuable in their own right as they are more urban, educated and have more income than their fellow citizens and often referred to as “Upper Deck Consumer Citizens” or Primary Consumers. The precision of the Thomson Reuters/Ipsos online polls is measured using a Bayesian Credibility Interval. In his case, the poll has a credibility interval of plus or minus 5.0 percentage points for all adults.
The Thomson Reuters/Ipsos India Primary Consumer Sentiment Index (PCSI), ongoing since 2010, is a monthly national survey of consumer attitudes on the current and future state of local economies, personal finance situations, savings and confidence to make large investments. The Index is composed of four sub-indices: Current Conditions Index; Expectations Index; Investment Index; and, Jobs Index. The PCSI Index is benchmarked to a baseline of 100 assigned at its introduction in January 2010. Index number is calculated by utilizing data from the survey results. Responses are divided into aggregated Top Box (Reward) numbers and Bottom Box (Penalty) numbers. Using Shapely Value Analysis, values were generated for the penalty and reward for each question. The magnitude of each question is the difference between the reward and penalty. An Importance factor, which the ultimate weight of the particular question in the index, is the magnitude of each question divided by the total magnitude of all questions. A Top Box Weight for each question is calculated by dividing the Reward by the magnitude of each question. Similarly, the Bottom Weight for each question is calculated by dividing the Penalty for each question by magnitude of the same. The Index Value for each question is calculated by using the formula: Importance x (Top Box Wt * Top Box %) – (Bottom Box Wt * Bottom box %).