Consumer sentiment in India rose to a new record high in July as respondents were bullish about future prospects for both business conditions and household finances, says a report. The GICI (Genesis India Consumer Indicator) - a monthly indicator tracking consumer sentiment pan India across personal finances, business conditions and buying conditions - rose to 62.44 in July from 60.00 in June, marking a new record high in the series. A result above 50 indicates respondents are optimistic while a reading below 50 indicates that pessimists outweigh optimists. The only component of the GICI to decrease in July was durable buying conditions, which measures whether respondents viewed it as a good time to buy durable goods.ALSO READ | Wheat futures slip 0.55% on firm supply As per the survey, respondents were postponing purchases to benefit from lower prices post the GST tax reduction. The GST Council, chaired by Union Finance Minister, last week cut tax rates on white goods as well as various handicrafts items and paints. “The rise in confidence among Indian consumers continued in July with sentiment hitting a new record high. Due to the nature of the index, the cuts to GST on July 27 actually depressed overall confidence by postponing spending ahead of the tax reduction,” Chief Economist of GMMR, Philip Uglow, said. Genesis Management and Market Research (GMMR) compiles GICI index. “Next month we are likely to see a strong bounceback in the key spending measures as consumers take advantage of lower prices,” Uglow said.ALSO READ | Sensex, Nifty scale fresh lifetime highs ahead of RBI policy decision
The report further noted that domestic spending on travel will account for some Rs 1.65 trillion over the coming three months across India as a whole, a significant portion of GDP. International spending on travel is expected to total around Rs 1.2 trillion.