Central Bank: People’s Factual Income Keeps Dropping

UrBC, Moscow, September 29, 2016. Despite the inflation rate slowing down a bit in August, people’s factual pay kept going down for the second month in a row both in annual and month-by-month comparison terms, Finmarket refers to the Central Bank’s August reports as stating.

Pay rise practices are growing increasingly more heterogeneous: for one, the difference in how salaries and wages get adjusted in the private and public sectors is now greater than ever. The public sector employees’ pay goes up most slowly and least noticeably. The unemployment rate declined from 5.6% in May and June down to 5.5% last month.

‘Consumer’s demand is currently still restrained by the Russians’ habit of saving rather than spending, and private individuals keep investing more money through bank deposits even though people’s factual income has been going down. According to the available estimates, changes on the consumer lending market still contribute very little (if at all) to people’s consumer spending. As a result, Russia’s retail trade turnover figures went on decreasing quite noticeably in August 2016 as in the previous months. The figures only stopped shrinking quite so fast in the non-food items sector,’ the Central Bank reports.

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