More Indians believe that consumer confidence is falling, inflation is rising and employment opportunities are dipping, according to a series of surveys conducted by the Reserve Bank of India.

Across households, the current perception on the general economic situation remained in the pessimistic zone for four successive quarters, and the outlook is worsening, the central bank said. The findings are consistent with the position the RBI took in its monetary policy review on October 4, in which it cut India’s growth forecast from 7.3% to 6.7% for the 2017-’18 financial year.

The RBI’s Consumer Confidence Survey, released on October 4, showed that 34.6% of the respondents believe that the general economic situation had “improved” as of September 2017, down from 44.6% in September 2016. About 40.7% said the economic situation had worsened in September 2017, against 25.3% in the same period last year.

The survey was conducted in six metros – Bengaluru, Chennai, Hyderabad, Kolkata, Mumbai and New Delhi. It got 5,100 responses on household perceptions and expectations on the general economic situation, the employment scenario, overall prices of goods and their income and spending.

The Current Situation Index, which measures consumer sentiments about the present economic situation, slipped further into the pessimistic zone, the RBI said.

The same set of parameters caused the Future Expectations Index, which measures overall sentiments about the economic situation in the next six months, to slip further in the September 2017 round, compared to its reading in the June 2017 round.

One of the respondents’ biggest worries was was employment prospects, with most responses falling in the “pessimistic zone”. The survey said 43.7% of the respondents believed current perception about employment has worsened, much higher than the 31.4% in November 2016. Their perceptions on income levels were also negative.

Despite the gloomy sentiment on income, more than 80% of the respondents reported spending more over the past year, the RBI said. However, this could be attributed to higher prices.

Forecasters change growth expectations

Another study – the RBI’s Survey of Professional Forecasters on Macroeconomic Indicators – found that forecasters had moderated their growth expectation for 2017-’18 and 2018-’19, but they expected growth to consolidate with higher savings and investment rate in 2018-’19. The results of this survey showed that real Gross Domestic Product (value of economic output adjusted for price changes) was likely to grow by 6.8%, and real Gross Value Added (value of goods and services produced in an area or sector of an economy) growth by 6.6% in 2017-’18. Headline consumer price inflation is expected to increase to 5% in the first quarter of 2018-’19.

Manufacturing sector might take a bigger hit

In another survey, the Industrial Outlook Survey of the Manufacturing Sector for Q2 of 2017-18, the RBI said that overall, business sentiment in the manufacturing sector had worsened. Availability of finance may deteriorate further in the third quarter of 2017-’18. “The outlook on the cost of raw materials and the cost of finance for Q3 of 2017-’18 improved, but manufacturing sector may continue to lose pricing power resulting into low profit margin,” it said.