Real income improved in 3Q20; unemployment rate was flat in September 2020

RUSSIA ENERGY / FINANCE - In Brief 20 Oct 2020 by Marcel Salikhov
Rosstat published its first monthly data for September 2020.Real incomes (reported currently quarterly) improved considerably (+6.4% q-o-q sa) but remained 4.8% lower than in 3Q19. Over the first nine months of 2020 real incomes were 4.3% down. Household incomes improved considerably after a lockdown but haven't yet been restored. The unemployment rate in September was 6.3% vs 6.4% in August. But the number of people getting unemployment benefits continued to increase. It is unlikely that the official forecast for real incomes (-3% in 2020) will be fulfilled. In 2Q/3Q the Government supported the incomes of the population by extra child benefits and increased unemployment benefits. But there are no official plans to repeat it. The second wave of coronavirus pandemic has led to some restrictions in economic activity (mainly in Moscow). August-September data for retail sales shows that restoration of consumer spending has lost its steam. Probably consumer sentiment worsened in October. Sberbank's weekly data on consumer spending showed that retail sales started to decline in October. Russian economy showed a strong recovery in Juny-July but lost momentum over the last months. The second wave of the coronavirus epidemic in Russia has already led to new restrictions, mainly in Moscow. It will probably worsen economic conditions in 4Q20. Chart 1. Real incomes, real wages and retail trade, January 2011 - September 2020Chart 2. Retail trade & services, January 2011 - September 2020Chart 3. Chart 4.

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