Rising fuel prices eating into non-discretionary, health spends: SBI report

The steady rise in auto fuel (petrol and diesel) prices has not only fanned inflation concerns over the past few months, but has also altered spending patterns of consumers. A recent report by the economic wing of State Bank of India (SBI) suggests that as consumers are spending more on fuel, it is crowding out expenses on health.

“Our analysis of SBI card spends indicates that spend on non-discretionary health expenditure has been substantially reduced to accommodate increased expenditure on fuel. In fact such spending has more than crowded out the spending on other non-discretionary items, like grocery and utility services to such an extent that the demand for such products has significantly declined,” wrote Dr. Soumya Kanti Ghosh, group chief economic adviser at SBI in a July 13 note.