By Andrei Skvarsky.
In reporting the findings of a recent monthly poll, Deutsche Boerse’s research unit MNI Indicators makes what appears to be its bleakest assessment of the status of the average Russian consumer in about a year and half.
“Things went from bad to worse” in November, and Russia’s economy is “on the brink of collapse”, the report quotes MNI Indicators chief economist Philip Uglow as saying.
Inflation reached its highest point in November since June 2011, pushing consumer sentiment down to “the lowest level on record”, MNI Indicators says.
MNI Indicators, which is a division of Deutsche Boerse-owned intelligence company MNI, carries out monthly polls involving telephone interviews with about 1,000 urban consumers in Russia selected randomly by a computer.
MNI Indicators’ calculations show today’s consumer sentiment to have gone down 19.2% year-on-year.
The real estate market “collapsed to a record low”, the firm says. With general consumer confidence sliding and interest rates hiking, there was a lot less willingness to buy a house.
Willingness to make big-ticket purchases hit the lowest level since MNI Indicators launched its monthly surveys.
According to the firm’s previous survey, in October more Russians than the month before thought the next 12 months would be a good time to buy a car, which MNI Indicators attributed to a government car scrappage scheme.
However, the latest poll suggested consumers saw November as “the worst time on record” to buy a car. MNI Indicators argues that an increased cost of credit, following another hike in the key interest rate, apparently outweighed the impact of the scrappage scheme.
“Things went from bad-to-worse in November with sentiment falling sharply to an all-time low as respondents became increasingly concerned about their household finances, business conditions and the housing market,” Uglow says.
“The slide in the price of oil and significant weakening in the rouble suggest confidence could fall even further over the coming months. Moreover, it is becoming more likely that the Bank of Russia will have little option but to tighten monetary policy further, causing additional pain to an economy on the brink of collapse.”
Sorry, comments are closed for this post.