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Russia: Declining retail sales indicative of weak economy

Russia’s economic growth seems to be grinding to a halt. At least, if dwindling retail sales are an indication. Turnover in April of this year went up with 6.4%, a decline compared to March, when it went up with 7.3%. The only positive is that investments saw a partial recovery after a brief collapse in the preceding month. However, these do not include private investments. An economist stressed that the disappointing drop in consumption growth is much more relevant than the increase of investments, which may cause a false sense of security.

Data in the field of wages and employment seem to confirm the Russian economy’s weakening. Unemployment was at an alarming low last April, with 5.8% the lowest in 4 years, symptomatic of a tight job market and a diminishing financial playground. Wages have gone up in the last two years, but this is a trend not expected to last.