Macroeconomic Factors Affecting Market Demand In India’s Fast-Moving Consumer Goods Sector
- IJLLR Journal
- May 7
- 1 min read
Swami Nath Mishra, Shri Venkateshwara University, Gajraula, U.P.
ABSTRACT
Macroeconomic variables reflect a country’s economic environment, as they influence the expectations and decisions of policymakers, investors, and business organisations. They point to the state of the economy based on the prevailing patterns that may be delineated by GDP, inflation, interest rates, employment statistics, and so on. More specifically, these variables can provide insights into the consumer market in a country. This is due to the fact that the direct or indirect movements of macroeconomic factors can significantly impact the demand for goods in a country’s economy (Baruah & Kakati, 2025). More notably, these factors can also critically influence consumer behaviour and market dynamics as a whole.
It is against this backdrop that this study evaluated the impact of macroeconomic variables, such as GDP, inflation rates, interest rates, unemployment rates, and exchange rates, on the consumer market in India over 20 years (2005–2024), using final household consumption expenditure (FHCE) (% annual growth) as a measure. The study adopted quantitative analysis, with descriptive statistics, correlation analysis, and regression (ordinary least squares) analysis conducted to assess the relationships after sourcing secondary data from World Bank databases.
The regression analysis showed that the aggregate macroeconomic factors were responsible for 91% variation in FHCE, with GDP having the most significant positive impact. Negative correlations were observed between FHCE and inflation rates, unemployment rates, and exchange rates.
Keywords: Macroeconomics, India, GDP, consumer market, inflation, unemployment, interest rate, exchange rate.
