While the decline in inflation has positively impacted the disposable income of households, it has still not resulted in higher consumer expenditure in the economy. Consumers are still cautious about the sustainability of the fall in inflation as they fear a bad monsoon could once again push up prices of food products. As a result, consumers are still deferring their spending. The prolonged slowdown of credit growth through FY11-15 has mirrored the slowdown in economic activity and asset-quality concerns of banks.
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