Households expect inflation to ease in the current period though they expect it to edge up over the three month to one year time horizon, a forward looking household inflation expectation survey released by the Reserve Bank of India on Friday indicated. Households’ inflation expectations for the three months and one year ahead periods increased by 20 basis points (bps) and 10 bps, respectively. One basis point is 0.01 percent. But their perception remained in single digits.
On current inflation, however it moderated by 10 bps and stood at 8.0 per cent in the latest survey round
Higher share of respondents expected prices and inflation to rise for all major product groups over the next three months as well as one-year periods.
The Reserve Bank has projected CPI inflation for 2024-25 at 4.5 per cent, assuming a normal monsoon. Inflation at the end of the first quarter of FY;2024-25 is projected higher at 4.9 per cent, at 3.8 percent for the September quarter, 4.6 per cent for the December quarter and 4.5 per cent for the March 2025 quarter.. The risks are evenly balanced, it said.
At the aggregate level, female respondents in the household inflation expectation survey had marginally lower inflation assessment and expectations than their male counterparts. Among occupation categories, self-employed respondents group expected highest inflation
For a one year horizon, households’ general price level expectations remained closely aligned with their assessment related to food prices and housing, the survey results showed.
The Reserve Bank released the results of the May 2024 round of its bi-monthly inflation expectations survey of households. The survey was conducted during May 2-11, 2024 in 19 major cities in the midst of the general elections , with responses from 5,943 urban households. Female respondents accounted for 52.6 per cent of this sample.