Consumer optimism has stabilized demand

Indirect economic indicators confirm that the growth in consumer optimism, recorded by the InFOM surveys conducted for the Central Bank in January-early February 2022, has transformed, if not into a revival, then into stabilization of the actual demand of households. Thus, according to Sberindex (spending by citizens on Sberbank cards), the nominal spending of the population on goods and services from February 20 to 26 decreased by 1.6% in annual terms against an increase of 5.1% and 6.1% in the previous two weeks. The reduction is due to the “high base effect” — a rush demand for non-food products was recorded a year ago (at the same time, the growth in spending on services and food has now continued, see chart).

“If we remove the base effect, then we estimate real consumer spending in February at the level of January (seasonally adjusted). Statistics for January will appear on March 1 – according to our estimates, in January, expenses grew after the December decline, ”analysts of the MMI Telegram channel comment. Nominal weekly consumer spending, as measured by Romir researchers, also grew more slowly from February 20 to 26 (by 9.9% in annual terms) against 11.6% in the previous week, when they actually stabilized in real terms.

Based on this, it can be assumed that the depreciating ruble, rising inflationary expectations and large pre-New Year payments stimulated consumption. In January, according to the Central Bank, even consumer lending, despite the abundance of holidays, accelerated slightly: by 0.5% mom (against 0.1% in December). “With accelerated price growth, there may be an incentive to purchase certain goods or services “until their prices rise,” which forms an overhang of consumer demand,” Raiffeisenbank notes.

At the same time, in January, according to Romir estimates, the share of “free” money in households (income minus spending on necessary goods and services) was equal to 29% of income, which is 12 percentage points more than it was in December. This may indicate that a significant part of the demand was not realized due to the unavailability of goods of adequate quality.

Artem Chugunov