RBI Initiates Three Key Surveys to Gauge Economic Sentiments Ahead of Monetary Policy Review

India’s central bank, the Reserve Bank of India (RBI), has commenced three crucial surveys designed to collect valuable public sentiment and expectation data. These surveys play a vital role in providing inputs for the RBI’s upcoming monetary policy decisions.

The RBI conducts bi-monthly monetary policy reviews to assess the economic situation and determine the appropriate stance on interest rates and other policy tools. With the next meeting of the Monetary Policy Committee (MPC) scheduled for June 4th to 6th, gathering timely economic intelligence is essential.

The three surveys launched by the RBI include:

1. Inflation Expectations Survey of Households (IESH): This survey aims to understand how households across 19 cities perceive current price movements and what they expect inflation to be in the future. It captures subjective assessments based on their everyday consumption experiences, providing insights into public sentiment regarding price stability.
2. Urban Consumer Confidence Survey (UCCS): Conducted in 19 cities, the UCCS collects qualitative feedback from urban households about their confidence levels regarding the general economic situation, the employment market, current price levels, and their own household income and spending patterns. This survey helps gauge the overall mood and financial sentiment among urban consumers.
3. Rural Consumer Confidence Survey (RCCS): Expanding the scope to rural and semi-urban areas across 31 states and Union Territories, the RCCS gathers information on households’ current perceptions and their expectations for the next year concerning the general economic situation, employment prospects, the overall price situation, and their personal income and spending. This provides a crucial perspective on economic conditions and confidence outside major urban centers.

The Reserve Bank of India conducts these surveys on a regular basis as a standard practice to monitor economic indicators and public perceptions nationwide. The data and insights gathered from the IESH, UCCS, and RCCS are considered important inputs that inform the Monetary Policy Committee’s deliberations and decisions regarding the stance and formulation of monetary policy. By understanding how households perceive and react to economic conditions, the RBI can make more informed choices to maintain price stability and support economic growth

Source – Fieo