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Indian Households Expect Inflation to Rise Further, RBI Survey Shows

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Amid heightening geopolitical tensions and global economic turmoil, Indian households expect domestic inflation to rise further, according to a survey released by the Reserve Bank of India on Friday.

The bi-monthly data of the Reserve Bank of India's Inflation Expectations Survey of Households for May showed that the current median inflation perception of households rose by 60 basis points to 7.8% from 7.2% in March.

The survey was conducted from May 2 to May 11 in 19 major Indian cities.

Expectations for inflation over the next three months jumped 80 basis points, while the one-year outlook climbed 50 basis points, reaching 9.3% for both horizons, the survey showed.

Separate surveys conducted by the central bank also showed a decline in confidence among both urban and rural consumers.

Urban consumer confidence, measured by the Current Situation Index (CSI), dropped to 90.7 in May from 95.7 in March. The Future Expectations Index (FEI), while remaining above the neutral 100 mark, declined to 118.7, the lowest level since September 2023.

Meanwhile, the rural CSI slipped to 95.2 from 98.0 in March, while the rural FEI fell to 119.3 from 125.1.

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