Kantar’s latest ‘State of the Nation’ consumer sentiment study reveals that Indian consumers are becoming increasingly cautious in response to economic and geopolitical uncertainty, creating new challenges and opportunities for brands. While consumer resilience remains intact, confidence in economic growth and personal finances has softened, prompting households to prioritise savings, value and long-term financial security.
The latest wave of the study, conducted in May 2026, follows Kantar’s January survey undertaken ahead of the Union Budget. At that time, consumers displayed a balance of optimism and caution as concerns around inflation, income stability and financial preparedness began to emerge. Since then, escalating geopolitical tensions, fears of a global economic slowdown and rising concerns about employment have further influenced consumer sentiment.
According to the findings, confidence in India’s economic outlook has weakened significantly. Only 48% of consumers expect the economy to improve in 2026, compared with 60% in January. Concerns about layoffs have also increased, rising from 36% to 41% over the same period. Expectations regarding personal financial growth have moderated as well, with 61% of respondents expecting their savings and investments to remain unchanged or decline compared with 2025, while only 39% anticipate growth.
Financial security has emerged as a major priority for Indian households. Healthcare expenses remain the largest concern, cited by 85% of respondents. Rising living costs worry 80% of consumers, while 78% are concerned about having sufficient retirement savings. Among consumers aged 36 to 45 years, retirement preparedness is a particularly significant issue. Additionally, 71% are concerned about meeting rent and loan EMI obligations.
As a result, savings behaviour is becoming more prominent. Nearly two-thirds of consumers, or 63%, say they are very likely to increase savings for themselves and their families. However, financial pressures remain evident, with 33% reporting a decline in savings and investments compared with 2025, while only 28% report growth.
The findings also point to more deliberate spending behaviour. Consumers are not withdrawing from discretionary spending altogether but are becoming increasingly selective. The proportion planning to increase discretionary spending has fallen from 55% in January to 53% in May, while those intending to reduce such spending has risen from 8% to 10%.
A similar trend is visible in high-value purchases. Consumers planning to increase spending on big-ticket items have declined from 46% to 44%, while those planning spending reductions have increased from 11% to 16%.
Inflation remains the leading driver of caution, cited by 65% of respondents. Other factors include the desire to save more money (48%), economic uncertainty (45%) and concerns around investment returns (42%). To manage household finances, 44% are reducing electricity and fuel consumption, 42% are eating out less and cooking at home more often, 41% are cutting subscription expenses, and 39% are delaying purchases until major sales events while seeking coupons and promotional offers.
For marketers, the findings highlight an increasingly value-conscious consumer. At the same time, consumers continue to invest in categories perceived to offer long-term value and emotional fulfilment. More than half of respondents, or 52%, are likely to purchase gold within the next 12 months.
Travel and experiences remain resilient despite broader spending caution. Around 60% plan to take a domestic holiday, while 52% intend to travel internationally and a similar proportion are willing to spend on once-in-a-lifetime experiences. This suggests consumers continue to prioritise purchases that contribute to wellbeing, personal enrichment and memorable experiences.
Deepender Rana, executive managing director, South Asia, Kantar, said: “Our latest report shows that Indian consumers remain resilient but are becoming noticeably more cautious as economic and geopolitical uncertainty rises. Confidence in future financial growth has softened, while concerns around job security, retirement preparedness and rising living costs have intensified. As a result, consumers are becoming more deliberate in how they spend- prioritising savings, value and long-term financial security, while continuing to protect experiences that enhance their wellbeing and quality of life. For brands, this presents a clear imperative: demonstrate tangible value, build trust and relevance and deliver meaningful benefits that help consumers navigate uncertainty with greater confidence.”
For brands, the report underscores the importance of delivering clear value propositions, building trust and aligning with consumer priorities around financial confidence, wellbeing and long-term security.
