Page 82 - RusRPTJul22

needed this year to increase pensions and social benefits, which is estimated at 0.3-0.4% of GDP. Next year, the need for additional resources is expected to be around 0.6% of GDP.
More than 90% of the additional funds will go to pension increases. The increases are paid from the budgets of the state social funds. They will receive the necessary additional funds from the federal budget, on which the financing of the additional expenditures of the funds will depend, especially as the economic downturn reduces their income. After a recent increase, the average pension is at a nominal exchange rate of around €230 per month. However, in terms of purchasing power, it is a couple of times higher than in Russia, as the country's average price level is much lower than in the euro area.
4.5.3 Retail sector dynamics
Retail Sales in Russia decreased 10.10 percent in May of 2022 over the same month in the previous year. The uncertainty caused by the wild swings in the currency and the start of the war has depressed demand as Russian stand back and wait to see how things develop. However, by June as the economy stabilised demand is expected to start to recover.
In seasonally-adjusted month-on-month terms, we estimate that sales were broadly flat last month and that they remain 11% below their February level. Within this, non-food sales seem to be nearing a bottom. The contraction came in at 17.2% y/y, versus a fall of 16.7% y/y in April.
Weak consumer demand was reflected in the dynamics of non-food retail - the retail turnover of non-food products fell by 17.2% in May. March purchases for the future of durable goods, credit contraction and supply restrictions are affecting, notes the Telegram channel, which is run by VTB Capital analysts.
82 RUSSIA Country Report October 2020 www.intellinews.com