Nov Boston Analytics Consumer Confidence Index up at 70.7

Excerpts from Markets Midday on CNBC-TV18 Watch the full show » RELATED NEWS Oct Boston Analytics Consumer Confidence Index at 70.2 ALSO READ See what other experts are saying about markets See what FIIs are saying about the markets See what Udayan Mukherjee is saying about the markets

The CNBC-TV18 Boston Analytics Consumer Confidence Index is back with over 10000 respondents polled over 15 cities. This index, which is most comprehensive monthly barometer of opinion of Indian consumers on the current and future state of the economy, has thrown up some interesting data for the month of November. The Consumer Confidence Index for November is at 70.7. In an exclusive interview with CNBC-TV18, Kimberlee Luce of Boston Analytics, shares her views on Consumer Confidence Index for the month of November.

Below is a verbatim transcript of the exclusive interview with Kimberlee Luce on CNBC-TV18. Also watch the accompanying video.
 
Q: Is this very good news because the extent of increase looks a little small?

A: I think the good news is that this is an evidence of a bottoming out for sure. Previous to the last two months, we saw a slow rate of decline and now we are actually seeing upticks. So, this is not the first uptick, we had uptick in the last month as well. In a way if we dig deeper into some of the variables that we use not to construct this index, we also see some other bright parts. So, I think this is good news. We have to see the trajectory going forth whether this means that we have sort of stabilized and bottomed out or whether indeed that we are looking at a big uptick. There are most of the variables that we trace, related to this index have actually remained fairly flat.
 
Q: This weakening optimism of about basic necessities and price hike in interest rates - so is that the biggest concern and is that what you found out? Going forward we have seen a spade of price hikes in essential commodities foods, vegetables in Indian markets over the last couple of weeks. You think that is the biggest concern?

A: It is interesting when you look at consumer spending; we track both basic necessities as well as we track discretionary spending too, which is made up of durables, housing and vehicle purchases. All three of those as latter three in discussions spending have actually their up levels of optimism is the same as we saw in October and September, which could be interpreted as good news because those were much at the height of the festival season. In contrast, basic necessities you are right, the optimism level has gone down significantly over the last month by almost 10%. We think that it links you also a dramatic increase in concern over inflation and both observed changes in price levels of today versus 12 months ago and what the people expects the price levels to be in a coming 12 months.