The footfall index at Russian malls continued its steady climb in July despite the ongoing contraction in retail in the country.
The data, released by Moscow-based Watcom, a consultancy that measures shopping activity in malls using 3D camera technology, showed that the index in the last week of July increased by 0.1% compared to the previous week and is higher by 4.23% compared with the same period in 2015.
Watcom chairman Roman Skorokhodov said: “The Shopping Index has stabilized which proves the fact that the Muscovites visit the shopping centers more frequently compared to the summer of 2015, taking into consideration the fact that in summer normally the footfall decreases. Everybody’s waiting till the end of August when people will come back from vacations and go shopping for school uniforms for their kids, as well as seasonal clothes. The Shopping Index normally rises then.”
The shopping index continued to rise despite the ongoing contraction in retail turnover, which was down by 5.8% in July y/y, which represents a slight acceleration from earlier in the year when retail contraction was at a low of -4.3% in February.
However, the outlook for consumption is improving after nominal wages increased by a surprisingly strong 9% in June y/y, which means that real incomes grew by 0.9-1.4% over the last two months.
The Russian economy's stabilisation led Russian Economy Minister Alexey Ulyukayev to declare “the recession is over” earlier this week. But at the same time it is a fragile recovery at best and consumption is not likely to return to its previous role as an economic driver any time soon.