India continues to lead the global confidence index: Study

India continues to lead the global confidence index for the quarter with a one point increase from last quarter to 130 followed by Indonesia (123) and Philippines (115). The Consumer confidence in urban India has increased by 9 points from Q1 2014 (121). 44 percent of respondents polled feel that India is still in economic recession.  These are the consumer confidence findings from Nielsen, a leading global provider of information and insights into what consumers watch and buy.

In the latest online survey, conducted Feb 23-March 23 2015, over four in five (83%) urban Indian respondents indicated the highest level of optimism globally on job prospects in the next 12 months, in the same quarter last year 74 percent (Q1 2014) were optimistic about their job prospects. This quarter, India is followed by Indonesia (74%) and Philippines (73%).

“The urban Indian has seen ups and downs in consumer sentiment over the last few years, - in this round it is a positive sentiment in anticipation of improvement through reforms and stimulus announced by the new government”, said Piyush Mathur, president, Nielsen India Region “These initial signs of optimism reflect anticipation of economic recovery that are yet to manifest when you look at fast-moving consumer goods and auto sectors in particular over the last few quarters. Moreover, infrastructure, engineering and other industrial sectors are yet to gather pace. The fall in inflation is expected to have an impact on disposable income over time, but it will take time for the sectors to be restored to perceptible and sustainable growth.”

The Nielsen Global Survey of Consumer Confidence and Spending Intentions, established in 2005, measures perceptions of local job prospects, personal finances and immediate spending intentions among more than 30,000 respondents with Internet access[1] in 60 countries. Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism, respectively. The latest results reflect an outlook of cautious optimism, as every region’s consumer confidence score improved compared to the previous quarter.

Discretionary Spending & Savings

Over three in five (65%) online respondents polled indicated this is a good time to buy things they want and need, four percent rise from last quarter (61% in Q4 2014). From the same time last year good time to buy things they want and need has gone up by 11 percent (54% in Q1 2014).

When it comes to investing spare cash, 64 percent indicated it is a good time to put spare cash into savings, while 49 percent of respondents polled purchasing new technology products.

The purchase intent for new clothes by urban online respondents stands at 44% this quarter, same as the last.  When it comes to creating a corpus of funds for the future two in five (40%) respondents indicated that they will invest in mutual funds, ten percentage points rise from last year (30% in Q4 2014), and 28 percent in a retirement fund.

79% respondents have changed their spending habits to save on expenses. The top three avenues this quarter are saving on gas and electricity (49%), spending less on new clothes (45%), and cutting down on holidays and short breaks (35%). A third (30%) of online respondents will look for better deals on insurance, home loans credit cards this quarter, five percentage points up from the last quarter (25% in Q42014).

Personal Finances, Concerns

Eighty percent urban Indian respondents indicated that the state of personal finances was good or excellent in the first quarter of 2015, four percentage points up from the same time last year (76% in Q1 2015). The top concerns are job security (22%), sustaining a work-life balance (11%), followed by state of the economy (9%). 12 percent indicated that parents welfare and happiness is the second biggest concern for the quarter.