Inflation effect: Rich splurge,rest rue

On an average,an MIG family was spending roughly a sum of Rs 4,000-6,000 per month on shopping,entertainment and eating out.

The decline comes at a time when the headline inflation has been above 8 per cent since February last year. Overall inflation stood at 8.31 per cent in February 2011.

Food inflation has also stayed quite high for some months with the latest data showing it to be 9.5 per cent for the week ended March 19.

Meanwhile,political turmoil in the Middle East and North Africa region (MENA) has led to a surge in crude oil price above USD 100 per barrel.

The survey was done in major cities like Delhi,Mumbai,Kolkata and Chennai,with more than 500 employees of every city,during January and March period.

Among the surveyed cities,Delhi stood first in curtailing expenses followed by Ahmadabad,Chandigarh,Mumbai and Chennai.

Nearly half or 49.5 per cent of MIGs have started avoiding shopping and 34 per cent said that their shopping has been restricted to only necessities.

However,as per the survey,the inflationary pressure seems to have not affected higher income group.

“Higher cost of money virtually unaffected high income group (HIG) group in the period,as it did not imbalance their earnings and thereby spending,” it said.

“HIG families in urban India were completely immune to rising costs as their income levels hardly got severed,” the chamber added.

On an average,HIGs spending on shopping,amusements,including eating out,is estimated over Rs 10,000-20,000 per month,which is similar to when inflation was below 7 per cent.

Among HIGs,the young lot and working couples,spent their major part of the income on clothes,shoes,movies,buying CDs of films and music,eating out,it added.