A majority of Indian consumers hope that the economy will grow in 2015. Consumer confidence in India has increased the highest in the Asia-Pacific region, says a Nielsen survey report. According to the report, consumer confidence in the country is at a four-year high since the first quarter in 2011 when it recorded an index score of 131.
According to Q4 of 2014 – Global Consumer Confidence, India is one of the 17 countries that have seen an upswing in consumer confidence. Consumer confidence in the country stood at 129 in Q4, an increase of three points from the previous quarter. Moreover, India leads 60 countries surveyed by Neilsen, says the report.
The consumer sentiment has improved due to the lowering of inflation rates and positive economic environment after the formation of the new government. Besides, improvement in several consumer-centric sectors like automobile and FMCG have pushed up consumer confidence in the country.
“In India, 2014 ended with an encouraging note of increased consumer confidence levels across all key indicators,” said Piyush Mathur, President, Nielsen India Region. “The trends in the finance sector also reflect this uptick in confidence, with credit card penetration rising, home loan disbursement higher than in the third quarter and improved auto sales. The overall fast-moving consumer goods industry is looking to grow by double digits in 2015 based on lower inflation rates and increased consumer sentiment. Consumers are hopeful of an improved economic environment with policies and reforms being set in place by the new government,” he added.
While consumer confidence in India seems to be rising, in the neighbouring China the index score dropped by four points to 107. In the last four quarters, China had seen its index score stay at 111.
Other BRIC countries such as Russia and Brazil also registered a dip in their consumer confidence levels. Russia saw a drop of 8 points to stand at an index score of 79, while Brazil recorded a dip of 6 points at 95. Even the global consumer confidence dropped by two points since the previous quarter and recorded an index score of 96.
Consumer confidence fell marginally in every region across the world during Q4 compared with the previous quarter. It declined by one point in North America (index score 106), Asia-Pacific (106) and the Middle East/Africa (95), three points in Latin America (88) and two points in Europe (76).
Going by the report, with this increase in consumer confidence, we can expect sectors such auto, FMCG and other consumer durables to pick up in terms of demand during the first half of 2015. We can also expect an increase in ad spends from brands in consumer-centric sectors.
However, Mathur indicated that there would be a lag of two quarters between confidence and consumption.