New Delhi: The decline in employment sentiment coupled with subdued spending behaviour have dragged down the Indian consumers' confidence in August, says a study by financial services provider BluFin.

BluFin's Consumer Confidence Index (CCI) fell to 39.6 in August from 41.1 in July. The index witnessed a decline after a slight improvement in July.

The BluFin CCI is a key 'aggregate' indicator that assesses the pulse of urban Indian consumers with regard to the economy, spending behaviour and employment. The index reflects pessimism at below 50 score and optimism above that.

The study is based upon interview of 4,000 urban consumers in 18 Indian cities, including metros and smaller cities.

"Recently, we have been seeing a consistent though gradual weakening in sentiment across cities around job security, household income as well as overall economic sentiment, which otherwise used to be relatively strong," BluFin CEO Rashid Bilimoria said.

"It seems, the slowdown in the Indian economy has persisted long enough for these largely macro variables to start getting impacted. This could mean that the pessimism is getting deeper," he added.

A sub index, which rates employment sentiment, has shown signs of weakening. After a moderate increase in July, in August the index dipped to 46.1, pushing it further away from the neutral mark.

Similarly, the index which measures spending behaviour witnessed a decline in the period under review after a rise in the sentiment in July. The index fell by 1.4 points to 26.5 last month.

Another sub-index, which measures future expectations was 36.7, indicating consumers were still pessimistic about the economy's prospects. Although, consumers were more comfortable about their present situation with a score of 46.6, according to the survey.

Consumer sentiment on inflation, at 26.4, is slightly up from July. Interestingly, it is the only sentiment index with a month-on-month improvement. Although, the index continues to have the lowest score among all the components.

Among the cities, Mangalore and Hyderabad are the most upbeat cities while Patna, Nagpur and Ludhiana are the most pessimistic, the survey said.

(Agencies)

Latest News from Business News Desk