Russia consumer demand drops, jobless jump

MOSCOW: Retail sales in Russia fell more than expected in April, while unemployment jumped above forecasts during a dire first full month of coronavirus lockdown for the country, data from statistics service Rosstat showed on Tuesday.

Russia’s economic health is in focus after a slump in the price of oil, its key export, and the coronavirus pandemic combined to batter the ruble and prompted the central bank to slash rates to prop up the economy. Retail sales, a barometer of consumer demand that is Russia’s main driver of economic growth, fell 23.4% in April from a year before and shrank by 28.5% month-on-month.

Analysts polled by Reuters in late April had on average expected retail sales to decline by 15 percent yearon-year. Rosstat data last week showed industrial output shrank 6.6 percent in April, driven by a drop in the manufacturing sector as the lockdown paralyzed most Russian business activity.

Economic indicators deteriorated in April as the coronavirus outbreak gained momentum in Russia, which now has the third-highest number of cases globally. The Russian central bank has signalled its readiness to sharply cut its key rate, now at 5.5 percent, next month. Lower rates are designed to support the economy by making lending cheaper and reducing the appeal of bank deposits.

Rosstat also said the number of people unemployed rose to 5.8 percent of the workforce in April, up from 4.7 percent in March, reinforcing concerns about worsening living standards. Analysts had forecast unemployment of 5.5 percent. — Reuters