By Andrei Skvarsky.
A Deutsche Börse-owned research company has said a survey it took in February before the crisis in Ukraine reached its disastrous proportions showed consumer sentiment in Russia to have slumped to its lowest level since March 2013.
Previous surveys by MNI Indicators showed consumer optimism to have risen in December and January to its highest level since October, but the London-based firm argued that the upcoming Winter Olympics in Sochi had been the main booster and predicted that the upbeat sentiment would not last.
February’s poll vindicated the forecast of MNI Indicators chief economist Philip Uglow that consumer sentiment would go back down after the Olympics.
An MNI Indicators report quoted Uglow as saying that, adding to the picture the “economic chaos” in Russia as a result of the Ukraine crisis, “it’s difficult to see confidence going anywhere but down next month as well.”
More than 70% of respondents in last month’s survey said the games would not be successful in boosting Russia’s economic growth.
Consumers were dissatisfied with their current conditions and had rather grim feelings about the future. Worries over inflation worsened. So did concerns about interest rates on car and home loans after remaining stable for the previous three months, the report said.
Perceptions about both current and future business conditions declined considerably as well, with more respondents blaming what they considered poor economic development and social instability.
“Last month’s pre-Sochi rise in consumer sentiment was short-lived with confidence falling sharply in February,” said Uglow.
“Concerns over prices intensified this month with the sharp decline in the rouble adding to inflationary pressures. Since the survey was taken, the situation in Ukraine has intensified and Russia has been thrown into economic chaos. It’s difficult to see confidence going anywhere but down next month as well.”