Russia consumer demand drops, jobless jump in April lockdown

MOSCOW, May 27 — 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 yesterday.

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 rouble 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 per cent in April from a year before and shrank by 28.5 per cent month-on-month.

Analysts polled by Reuters in late April had on average expected retail sales to decline by 15 per cent year-on-year.

Rosstat data last week showed industrial output shrank 6.6 per cent in April, driven by a drop in the manufacturing sector as the lockdown paralysed 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 per cent, 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 per cent of the workforce in April, up from 4.7 per cent in March, reinforcing concerns about worsening living standards.

Analysts had forecast unemployment of 5.5 per cent. — Reuters