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The MNI Russia Consumer Indicator fell sharply to the lowest level since the survey started in March 2013, as the Ukraine situation hit personal finances and saw consumers cut back spending on big ticket items.
The Consumer Indicator declined 5.4% on the month to 89.1 in March from 94.1 in February, leaving sentiment 8.4% down on the period a year earlier.
The threat of further sanctions and weakness in the currency, coupled with near zero growth in the first quarter has seen consumer confidence fall by more than 10% since the start of 2014.
Consumers were most concerned about their Current Personal Finances which plummeted to a series low. Durable Buying Conditions fell sharply given the uncertainty about the economic outlook.
Some respondents thought that the country was being negatively impacted due to its intervention in Ukraine. A growing proportion of respondents said that the downturn in their finances was due to their current employment situation. Perceptions about Business Conditions in a Year’s time also deteriorated considerably as consumers saw further sanctions hurting businesses.
Commenting on the latest survey, Philip Uglow, Chief Economist of MNI Indicators said, “Russia’s actions in Ukraine were never going to be costless and consumer confidence has taken a battering over the past two months as worries over their personal finances and the outlook for the economy have grown.”
“Our Russian Business Indicator has already shown a hit to companies following the events in Ukraine and, together with the consumer data, suggest Russia’s economic malaise will continue or worsen.”
