India slips to second on Nielsen’s consumer confidence index

MUMBAI: Consumer confidence in the country fell slightly in the first quarter of 2013 when India slipped to the second position behind Indonesia in Nielsen’s global consumer confidence index.

According to the latest findings by the market insights and information provider, Indian consumer confidence fell one point from the previous quarter to 120 points in the January-March quarter. India was the most optimistic country in the December quarter.

“The last year has seen shifting sentiment on confidence, where consumers are feeling good about themselves, but not the environment around them,” Piyush Mathur, president at Nielsen India, said. “This highlights a contradictory nature of the urban Indian consumer.”

While Indian consumers are cautious about the state of the economy and middling company performance, at the same time they indicate higher discretionary spending for the year, he said.

Optimism on spending was better with 42% saying they would invest in new technology and products, up from 39% in the previous quarter, while 41% indicated they would spend spare cash on new clothes, a five point increase.

“Small ticket consumption will be encouraged, but not large ticket investments like automobiles and homes,” Mathur said.

As many as 60% respondents in India indicated that they would put spare cash into savings, up from 54% in the December quarter.

Concerns on jobs and state of the economy remain high as more than one in five respondents indicated that jobs security is their biggest concern. Indian consumers also felt more pessimistic about job prospects in the coming months and were mixed on their income prospects.