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Review: How have the Current Situation Index (CSI) and Future Expectation Index (FEI) change through the pandemic?


In India, the Consumer Confidence Survey (CSS) by the RBI comprises of Current Situation Index (CSI) and Future Expectation Index (FEI) and gauges consumer perception and expectation on various parameters – Economic situation, Employment, Price Level, Income, Inflation, Spending etc. Here are how these indices changed through the pandemic. 

The Reserve Bank of India (RBI) recently published the January 2022 edition of the monthly bulletin. Four articles highlighting different aspects of the economy were covered in this bulletin – State of the economy, Indian Agriculture, Consumer Confidence in India, Foreign Direct Investments in India. 

Consumer Confidence about the current business & job markets along with their future expectation is a key indicator for countries including India to ascertain the current situation of the economy and formulate policies accordingly. 

In India, the Consumer Confidence Survey (CSS) comprises of Current Situation Index (CSI) and Future Expectation Index (FEI) and gauges consumer perception and expectation on various parameters – Economic situation, Employment, Price Level, Income, Inflation, Spending, etc. Here is a detailed explainer on the Consumer Confidence Survey and what it indicates.

As the country is on the road to recovery post the two waves of COVID-19 and related control measures, the Consumer Confidence Survey offers key insights on the impact of COVID-19 on consumer confidence. 

In an earlier story, we analysed the results of the March 2021 round of the Consumer Confidence Survey. After that, India experienced a devastating second wave of COVID-19 during April – June 2021. In this context, the latest round of Consumer Confidence Survey conducted for November 2021, assumes importance. 

As part of the January 2022 bulletin, RBI published an article titled, ‘The Impact of Covid-19 Pandemic on Consumer Confidence in India,’ which analyses the impact of COVID-19 on Consumer confidence, based on the Consumer Confidence surveys and related studies. 

While there are signs of improvement, Consumer confidence is still largely pessimistic 

In the earlier story, we highlighted that Consumer Confidence weakened significantly during the March 2021 round of the survey, with the Current Situation Index (CSI) falling to 53.1. 

With the onset of a severe second wave of COVID-19 and the ensuing lockdown measures across the country, consumer confidence has further dipped. This was obvious in the next two rounds in May-2021 & July-2021, with CSI of 48.5 & 48.6 respectively. With the second wave weakening post-July 2021, there was an uptick in consumer confidence. 

The CSI during November 2021 was 62.3. This is still in the pessimistic territory of below 100. While COVID-19 has heavily impacted consumer confidence, it ought to be noted that India has been in this zone much before the COVID-19 pandemic set in. 

While the CSI presents the consumer sentiment of the current business & job market conditions, the Future Expectations Index (FEI) indicates the future expectation in the business conditions, employment, income, etc. over the next year. 

The FEI in the latest round is more optimistic, compared to the CSI during the second wave of the pandemic. 

RBI’s article draws the correlation between the performance of the economy and consumer confidence. India’s GDP was in a downward trend since the last quarter of 2017-18, with the COVID-19 pandemic further contributing towards the decline in the economy. After negative growth in GDP during the pandemic, the GDP has registered a positive growth since Q3 of 2020-21. 

This recovery could translate into improved consumer confidence. While the FEI has certainly improved, there isn’t an overwhelming improvement. This could indicate that the consumers are unsure about the aftereffects of the pandemic in the foreseeable future. 

Contrary to projected numbers of the third wave starting January 2022, the reported caseload has been lower. Unlike the second wave, the third wave has also been a milder one leading to fewer hospitalizations and fewer deaths. This also meant fewer restrictions and lockdowns across the country, without majorly affecting business activity. This could boost Consumer confidence in the upcoming surveys. 

After historic lows, there is an improvement in Consumers Perception of Economy 

The Consumer Confidence Survey gauges consumer perception and expectations on 8 parameters. Among these, economic situation, employment, prices, inflation can be considered as consumers view the overall economy. 

Here is a snapshot of Consumer Confidence regarding these 4 parameters. 

Economic Situation 

As reflected in the overall Consumer survey, there is an improvement in consumer perception of the overall economic situation over the last two rounds i.e., in September 2021 & November 2021. But it is still in a negative territory, with a larger share of the respondents considering that the economy is in a worse situation. 

  • 70.8% of the respondents during the November 2021 round of the survey felt that the economic situation has worsened. Around 16.6% feel the situation has improved. The net response for the Economic situation was -54.2
  • This is an improvement after the low of -75 in May 2021 and also an improvement over the situation at the beginning of the second wave i.e., -63.9 in March 2021. 
  • Meanwhile, the future expectation is better off at a positive 5.2 in November 2021, just about the same levels as in March 2021.  


In March 2021, the current perception was -62.4, which worsened further during the second wave with -74.9 in May 2021. The fall in the number of cases and the economic opening meant that the perception improved in further rounds of the survey.

The future expectation also took a hit during the second wave, with it reaching a record low of -13 in May 2021. In the latest November 2021 round, the consumer’s future expectation about employment is optimistic at 15.4. 

Prices & Inflation 

In contrast to an improved perception about Economic Situation and Employment, the consumer perception about Prices & inflation has worsened. 

In March 2021, the current Perception was – 92.6, which sort of improved during the second wave. However, in the recent round of CCS, it fell to -94.5. The same is the case with inflation where it fell from -86.1 in March 2021 to -89.3 in November 2021. 

The concern is that apart from the dwindling confidence in the current situation of prices & inflation, the future expectation has also worsened.  The FEI fell from -64.4 to -66 for Prices, and in cases of inflation, it fell from -76.6 to -77.5 between March 2021 and November 2021.  

Supply chain disruptions, price shocks, etc., seemed to have a bearing on consumers’ perception of prices & inflation, as per RBI’s article. 

While a majority feel the incomes have reduced, there is also a perception of increased spending

The other Four parameters i.e., income, spending, essential spending, non-essential spending provides insights into consumers’ assessment of their own situation. 


A greater number of consumers feel that their income has increased during the November 2021 round of the survey compared to that of March 2021. However, this is after a fall during July 2021 at -59.1. The current perception is at -40.6 in November 2021. While there is a substantial improvement in the current perception, the same isn’t the case with FEI. The expectation has only slightly improved from March 2021. 

In March 2021, the FEI for income was at 33.4, which improved to only 35.4 in November 2021. However, compared to during the peak of the pandemic, it is a major improvement from 27 in May 2021. 

Spending, Essential & Non -essential spending 

Household spending is considered to be one of the more resilient parameters of the survey. 

  • In March 2021, the current perception of spending had a net response of 38.2. Since then, the number of respondents who are of the perception that their spending has increased has also increased. The net response for current perception was at 47.1 by November 2021. 
  • However, as a future expectation, fewer respondents have stated that they expect an increase in their expenditure. In March 2021, the net response was 59.3, which fell to 58.2 by November 2021. 
  • The overall spending is driven by the increase in essential spending, while the greatest number of respondents have stated that there is a decline in non-essential spending. 
  • As a future expectation, an increasing number of consumers expect that there could be an increase in their non-essential spending. 

While the expectations are less impacted by pandemic, the current situation has a major impact 

As per the essay in RBI’s bulletin, the current perception of the general economic situation is more aligned to employment scenarios and prices while with spending, it is marginal. In the case of household income, it has become more coherent with the economic perception during the pandemic. The perception of a slowdown in the economy during the pandemic has a direct correlation with the employment situation and household income. The sentiment improved as the pandemic situation has improved. 

The increase in essential spending also correlates with the perception of the economy, where the spending was mostly on essentials compared to non-essentials. Essential spending is related to prices while non-essential spending is more discretionary. While the vagaries of the pandemic have had an impact on how the consumers perceive their current situation, the future expectation has largely remained less impacted compared to pre-pandemic. 


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