Moscow: Russian retail sales growth unexpectedly slumped in October after unemployment increased for the first time since January and slower-than-estimated gains in wages and incomes curbed consumer purchasing power.
Receipts at merchants rose 3.8 per cent from a year earlier, the slowest pace since February 2010, after a 4.4 per cent increase in September, the Federal Statistics Service in Moscow said in an emailed statement on Tuesday. The median forecast of 16 economists surveyed by Bloomberg was for 4.5 per cent. The jobless rate rose to 5.3 per cent from 5.2 per cent.
Faltering domestic demand poses risks to the world’s largest energy exporter, which has relied on household confidence to insulate the economy from Europe’s debt crisis and slowing growth in China. Smaller gains in consumption are also hurting companies such as X5 Retail Group NV, Russia’s largest food retailer by sales, which today reported third-quarter profit that missed analyst estimates.
The economic figures “can be linked to slower growth in incomes, wages and a relatively high level of the inflation rate,” Alexander Morozov, chief economist for Russia at HSBC Holdings Plc in Moscow, said by phone.
Russian equities fell, heading for the biggest drop in a week, with the Micex Index losing 0.3 per cent to 1,393.99 by 5.47pm in Moscow. The ruble is the top performer among more than 20 emerging-market currencies tracked by Bloomberg on Monday, gaining 0.5 per cent against the dollar. “The Russian consumer’s financial position deteriorated further in October,” Johannesburg-based Tradition Analytics said in an emailed research note. “It is evident that rather prominent inflationary pressures are weighing on the consumptive sector as inflation eats into the disposable income of consumers.”
The pace of price growth has surged past the central bank’s target of 5 per cent to 6 per cent this year, forcing policy makers to raise interest rates in September. The inflation rate unexpectedly fell to 6.5 per cent last month from a year earlier, compared with 6.6 per cent in September. Real average wages increased 5.2 per cent in October from a year earlier, missing the median estimate of 6.1 per cent, the service said.
Disposable incomes advanced 2.4 per cent, below economists’ forecast for 4 per cent growth. Fixed-capital investment unexpectedly jumped 4.9 per cent from a year earlier and surged 14.4 per cent on a monthly basis.
Economists forecast a per cent decline from 2011. “The acceleration of investment is seasonal and relates to the fact that toward the end of the year investment programmes are implemented more actively,” Dmitry Kharlampiev, director for macroeconomic research at OAO Petrocommerce Bank in St. Petersburg, said by email.