Plunging retail sales and real wages have dashed hopes Russia's economic slump is past its worst, with data published on Monday instead suggesting that situation is getting worse. But as with the previous month, September's data painted a mixed picture, with a double-digit fall in consumer spending to some extent mitigated by investment declining by less than expected.
Retail sales, a barometer for consumer spending, fell by 10.4 percent year-on-year, the Federal Statistics Service data showed. That was worse than a 9.1 percent fall in September and well below analysts' forecasts. "The contraction in retail sales is huge and the worst since 1999. That shows that there are no signs yet that consumers are feeling any better," said Liza Ermolenko, economist at Capital Economics in London.
Real wages also continued to plummet, falling 9.7 percent, slightly better than analysts had forecast but worse than in August.
The statistics service revised its estimate for August's real wages slump from -9.8 percent to -9.0 percent. However, capital investment fell in September by less than in August and than forecasts, although it was still down by 5.6 percent, compared with August's 6.8 percent slide. This follows data on industrial production last week which was also better than expected, helped by a rebound in manufacturing. "It looks like the industrial sector is bottoming out," said Ermolenko. A weaker rouble has cut into consumers' real incomes but helps producers by making it easier for their goods to compete against more expensive imports.