Bloomberg News

Russian Retail Sales Slowed in October as Unemployment Rose

November 21, 2008

Russian retail sales slowed more than economists forecast in October as unemployment rose and wage arrears soared.

Sales increased an annual 12.3 percent in October, compared with 14.2 percent in the previous month, the Federal Statistics Service said in an e-mailed statement today. That was the slowest pace since May 2006 and was lower than the median forecast of 11 economists surveyed by Bloomberg for 13.7 percent growth. Retail sales increased 1.6 percent in the month.

Unemployment climbed in October to 6.1 percent from 5.3 percent as industrial production slowed as a result of the global economic downturn and companies fired employees to cut costs. Total wage arrears jumped in October by 33 percent, or 1 billion rubles ($36 million). President Dmitry Medvedev's economic aide, Arkady Dvorkovich, said this week that Russia's economic growth may slow to 2 percent next year from the Economy Ministry's forecast of 7.3 percent growth in 2008, according to RIA Novosti.

The average monthly wage rose an annual 11.8 percent in October to 18,093 rubles ($658.69), compared with a revised 11.4 percent in September the statistics service said. Disposable income increased an annual 6.9 percent, compared with a revised 6.8 percent in September.

Capital investment growth slowed to an annual 6.9 percent in October, the lowest rate since February 2006, according to the statistics office. Investments grew 11.8 percent in the previous month.

To contact the reporters on this story: Alex Nicholson in Moscow at anicholson6@bloomberg.net;

To contact the editor responsible for this story: Chris Kirkham at ckirkham@bloomberg.net


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