<p><strong>MUMBAI:</strong> Since FY18, the yearly increase in the price of necessities has been surpassed by lifestyle inflation, or the shift in consumer spending toward higher-end goods. The price rise of necessities is more of a supply-driven phenomena that requires focused government action, while lifestyle inflation is a reflection of demand that is often managed by policy rates.</p>
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<p>The economics department of Bank of Baroda said that the rate of lifestyle inflation has increased since FY18. It increased slightly to 6.4% in FY23 from 4% in FY18. Per capita gross national disposable income increased at a CAGR of 8.5% for the same time period.</p>
<p>Lifestyle products such as glassware within utensils grew from 2.8% to 6%, candles from 3.1% to 7.1%, and monthly maintenance costs from 2.2% to 10.9% in comparison to FY18. In a similar vein, cars increased from 2.4% to 7.7%. There were increases in other electronic devices as well. For example, mobile phones went from 0.3% to 5.9%, and PCs and laptops from 1.6% to 9.1%. While travel products climbed from 1.1% to 3.8%, clocks and watches increased from 4.9% to 7.9%. According to the research, these changes are a reflection of rising affordability and desire for higher living standards.</p>
Inflation of “lifestyle” surpasses necessities
