Russia retail sales up 1.9 percent year-on-year in August, more than expected

Published 09/19/2017, 10:56 AM
Updated 09/19/2017, 11:00 AM
© Reuters. A worker is seen behind a front window as he takes part in the construction of a shop in central Moscow

By Andrey Ostroukh and Polina Nikolskaya

MOSCOW (Reuters) - Retail sales in Russia rose more than expected in August, data showed on Tuesday, underpinning an official forecast that the economy is on track to return to growth levels seen before its 2015-16 slowdown.

Russia's oil-dependent economy has benefited from a recovery in global crude prices, prudent fiscal policy and the central bank's anti-crisis monetary measures.

But the recovery could still be hampered by declining wages, with average monthly salaries falling to 38,040 roubles ($655) in August, its lowest since February.

The data from the Federal Statistics Service showed retail sales - a gauge of consumer demand, which is Russia's key economic driver - grew 1.9 percent in August, compared with a year ago.

That was above the 1.2 percent growth predicted by analysts in a Reuters poll.

"This pick-up has been supported by falling inflation, which has reduced the squeeze on households’ purchasing power," analysts at Capital Economics said on a report.

Last Friday the Russian Central Bank increased its forecast for growth in gross domestic product (GDP) by the end of this year to 1.7-2.2 percent from 1.3-1.8 percent.

© Reuters. A worker is seen behind a front window as he takes part in the construction of a shop in central Moscow

However, real wages data surprised on the downside. Real wages, which are adjusted for inflation, were up 3.7 percent in August. Analysts polled by Reuters had expected them to grow by 4.2 percent.

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