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Consumer confidence and future expectations in India fell in March, a Reserve Bank of India survey found, as rising coronavirus cases cast a cloud over the economy.

The consumer confidence index fell to 53.1 in March 2021 from 55.5 in January 2021, the RBI survey released on Wednesday showed. “Consumer confidence for the current period weakened in March as the current situation index dipped further in negative territory on the back of deteriorating sentiments on general economic situation, income and prices," said the survey.

Future expectations dipped to 108.8 from 117.1 during the period. The moderation was driven by lower expectations on the economic situation, the employment scenario and income conditions. An index value below 100 represents pessimism, while above 100 signals optimism.

“Respondents expressed lower optimism for the year ahead, which was reflected in the future expectations index (FEI); one year ahead sentiments on all major parameters except prices, however, remained in positive terrain," the survey said.

The survey conducted through field interviews between 27 February and 8 March in 13 cities recorded perceptions and expectations on general economic situation, employment scenario, overall price situation and own income and spending from 5,372 households.

With higher essential spending vis-à-vis a year ago, most consumers reported higher overall expenditure, which is expected to increase further in the coming year despite continuing moderation in discretionary spending.

The regulator also released the results of the March 2021 round of the Inflation Expectations Survey of Households, conducted through field interviews during 27 February to 8 March 2021 in 18 major cities. The results are based on responses from 5,955 urban households.

Households’ median inflation perception for current period as well as three months ahead expectation increased by 50 basis points (bps) and 80 bps, respectively, as compared to the January 2021 round.

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