Inflation Bites: The rise in the prices of edible oil including onion and tomato has ruined the budget of consumers. This inflation has come when the festive season has arrived. Dhanteras (Dhanteras 2024), Diwali (Diwali 2024) at the end of October and Chhath Festival in the first week of November. In such a situation, the inflation of food items has forced people to cut down on their other expenses. This festive season, due to back-breaking inflation, Indian consumers are reducing or postponing purchases of expensive electronics items.
Inflation spoils the fun of festive season
The festive season has started with Navratri from the month of October which will continue till the middle of November. The beginning of the festive season has been very lackluster. According to Reuters report, the pace of sales of electronics and home appliances has been slow this festive season. According to Nilesh Gupta, director of Vijay Sales, in October this year, sales of electronics and home appliances have increased by only 5.7 percent as compared to last year. Whereas 8-10 percent increase in sales was expected. However, he expressed hope that sales may pick up pace in the coming days.
Signs of slowdown in the economy!
Due to the surge in demand and consumption in rural areas, the Reserve Bank of India has projected the economic growth rate to increase at the rate of 7.2 percent for the financial year 2025-25. But high indicators like auto sales and manufacturing, Purchasing Managers’ Index (PMI) and GST collection figures are indicating weakness in the economy. On top of that, skyrocketing inflation is adding to the leprosy. Due to the rise in the prices of food items and especially vegetables, the retail inflation rate has reached 5.49 percent in September 2024, whereas the food inflation rate has been 9.24 percent. The inflation rate of vegetables has been 36 percent. CAIT National President BC Bhartia said that the rise in prices of onion and other food items has affected people’s purchasing power. CAIT, an organization of trends, has estimated sales of Rs 4.25 lakh crore in this year’s festive season, which is 13 percent more than last year.
There is slowdown in online sales!
The pace of online sales is also slow, which accounts for 15 percent of the total sales during the festive season. Pushan Sharma, Direct Research, CRISIL Market Intelligence and Analytics, said, there is a weakness in the sales of entry level mobile phones. However, sales of premium models are better. Consultancy firm Redseer has estimated sales of 1 to 1.2 trillion dollars in the current festive season, which is 13 percent more than last year. However, to woo customers, e-commerce companies like Reliance Retail, Amazon, and Flipkart are offering huge discounts. Dinesh Taluja, senior executive of Reliance Retail, told analysts that between July and September During this period, weak sales were seen in the fashion category but now it is picking up.
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