India likely to see surge in private consumption in current fiscal year: Ind-Ra
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Credit rating agency, India Ratings and Research (Ind-Ra) in its latest report has said that India is likely to see a surge in private consumption in the current fiscal year (FY25), amid rural demand recovery owing to normal monsoon and moderating inflation.
It further said that the rise in private consumption would lead to more balanced growth, reducing the disparity between premium and value segments. The rating agency also expects urban demand to also continue to grow but at a slower pace, noting that there has been a constant rise in rural consumption demand in recent years.
Besides, Ind-Ra said that rural - urban inflation distribution is concerning, given that rural wage growth is perennially facing higher inflationary pressure versus urban (owing to higher food CPI), amplifying a negative impact on consumption. However, it believes the positive real wage growth in the past few months along with the expectation of a normal monsoon may support rural demand in FY25.
