Page 52 - RusRPTJun20

and initially in denial as Russian President Vladimir Putin was keen to go ahead with a referendum on the constitutional changes that could extend his rule by two more terms. However, Moscow mayor Sergey Sobyanin warned in a televised meeting with the president that the extent of infections was much wider than the official numbers suggested and took action.
Moscow was put on lock down on March 30 and an increasingly stringent stay-at-home regime was rapidly extended to everyone in the capital. Within days most of Russia’s regions followed suit.
With bars, cafes and all non-food related retail outlets even the rapid shift to shopping online was unable to make up for the damage done.
“Retail sales in Russia drop off the cliff under the lockdown. -23.4% y/y is a lot. Similar indicator was at -20.5% for China in February, at -9.2% for Eurozone in March, and at -21.6% for US in April,” said, Tatiana Evdokimova, Nordea Russia Chief Economist in a tweet.
Presidential Ombudsman for Business Boris Titov said during an online conference on May 6 he expects consumer demand in Russia to decline 10-15% in 2020 due to the coronavirus pandemic, TASS​ ​reported​.
“We expect that countrywide real wages will fall. This applies primarily to the private sector, but also in the segment financed from the budget wages will be reduced. Therefore, [we will lose] 10-15% of demand at least this year,” he said. At the same time, Titov found it difficult to give a longer forecast.
The population is spending mostly on food ​and all big ticket or non-essential purchases have been put off during the uncertainty. Household spending on groceries reached 46% of total expenditures in March – a record high since this index was introduced -- according to Romir Scan Panel.
Average household expenditures was down 13% m/m in April and 17% y/y, at RUB 56,800, as non-food purchases were reduced on the back of the lockdown measures, according to Romir Scan Panel. However, monthly food spending was up 9% m/m and 21% y/y, at RUB26,000, as customers were stocking up during the restrictions and food prices spiked (3.5% y/y in April vs. 2% y/y in 1Q20).
However, monthly food spending was up 9% m/m and 21% y/y, at RUB26,000, as customers were stocking up during the restrictions and food prices spiked (3.5% y/y in April vs. 2% y/y in 1Q20).
The retail sector showed comparable dynamics to consumers’ budgets, with grocery sales being the most resilient in April (flat y/y), and some categories, such as wine sales, growing (up 16% y/y). Non-food, on the other hand, was under pressure. The greatest decline was in the apparel and footwear category (-77% y/y), although other sectors also declined: there were y/y drops in consumer electronics (21%), DIY (15%) and pet and medical goods (3-4%)
Some of the fall was also due to households paying off debt and improving their personal financial position, acording to ING​.
“The banking statistics suggest that the April drop in consumption was not a result of a deterioration in households' balance sheets. Around 80% of the
52​ RUSSIA Country Report​ June 2020 ​ ​www.intellinews.com