The mood amongst Russian consumers brightened a tad in the second quarter of this year, but overall Russia’s consumers remain very gloomy. Russia’s consumer confidence index ticked up by 1 percentage point in the second quarter to -15%, Rosstat reported on July 7.

The share of people who think that the recent economic changes are positive rose to 12% in April-June from 11% in January-March, while those that think they are negative fell to 42% from 45%. The share of people that believe there has been no change rose to 46% from 43%.

The number of people who expect economic improvements in the next 12 months fell to 15% from 16%, while the share of people that see negative dynamics in the Russian economy decreased to 29% from 33%.

The Russian consumer is depressed after six years of real income stagnation, which is feeding through into depressed retail turnover figures. What consumption growth there is has been driven by growing retail borrowing that is expanding by 25% a year, causing the Central Bank of Russia (CBR) to fret about a growing consumer credit bubble.

The consumer confidence results stand in stark contrast to the business confidence survey, where there has been a much more pronounced increase in confidence.

From a low of -8% in December at the end of a decidedly nervous autumn, business confidence rapidly improved in January, jumping to -25, and then ticked up again to -1% in May.

The improved confidence survey numbers are a comment by businesspeople on their own business, but they also remain depressed in that private corporate investment remains very depressed. Businesspeople have got their businesses to the point where they are making money, but they are not confident enough about the future to want to invest into growth.

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