TMPress SPECIAL INFObase Report - August Data Show Resilient Growth ... via TMPress International Newswire ... and Nico Varkevisser ... (New York) ... Retail Sales grew at their fastest rate in three months as the Russian economy showed tentative signs of improvement in August. While the 1.4% rate is far below long-term trend rates it is a big improvement on June’s dire 0.7%. The figure is also far stronger than most economists had expected, given that they expected retail sales to go negative in the second half of 2014. Meanwhile forward-looking indicators posted their best levels of 2014. Real disposable Incomes grew at 3.4% in August which is faster than July’s 2.3% and took the year to date gain to 0.7%. Earlier months of contraction is the main reason for the current slowdown in retail sales, and thus August’s fast acceleration is extremely encouraging as we begin to enter the hugely important Christmas season for retail sales. The other forward looking indicator which is related to the “real” aspect of data is inflation. In Russia, the PPI is a forward leading indicator of CPI, because the ruble drives a lot of firm’s input prices. PPI not only fell dramatically in August but fell well below CPI at 5.4% indicating that inflation will subside in the coming months allowing even larger gains for disposable incomes and thus ultimately retail sales. The seasonally important agricultural sector once again registered a strong gain in August growing by 4.6%. In August agriculture makes up around 10% of GDP, thus this should add around 0.46% to the GDP growth rate for this month. As reported yesterday, Russia has posted extremely strong grain output this summer. (Contd) russia-insider/en/business/2014/09/18/01_34_12/august_data_show_resilient_growth
Posted on: Sat, 20 Sep 2014 17:11:03 +0000
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