Despite Russian dictator Vladimir Putin’s claim that the Russian economy is expected to grow in 2023, “retail sales remain in a contraction that’s already more drawn out than its declines” during the Covid-19 pandemic, according to Bloomberg’s latest report.
Bloomberg reported the consumer sector accounts for about half of Russia's economy.
In January, retail sales in Russia shrank an estimated 10.7% from last year, “falling for a 10th straight month in a stretch longer than their crash at the height of the pandemic in 2020,” according to the report. Bloomberg also says that in December the real wages “probably fell” at the “sharpest pace in five months.”
According to the report, the downturn shows a “permanent drop” in Russia’s living standards, “similar to the impoverishment and a record stretch of shrinking retail sales in the years after the 2014 annexation of Crimea.”
“It’s a stark contrast to the resilience of an economy that endured a year of sanctions with a much shallower recession that first expected,” the report reads.