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. Last Updated: 07/27/2016

Retail Sales Rise, Below Forecasts

Russian retail sales rose for a second month in February as higher wages fueled consumer spending, the State Statistics Service said Friday.

Sales rose an annual 1.3 percent after a 0.3 percent increase in January, the statistics service said in an e-mailed statement. The median forecast of 13 economists surveyed by Bloomberg was for an increase of 4.2 percent. Sales fell 3.5 percent on the month.

"We expect retail sales to improve in the coming months, reflecting the improvements in people's incomes," Alexandra Yevtifyeva and Dmitry Fedotkin, analysts at VTB Capital, said before the release. "The ongoing drop in inflation and the likely stabilization in unemployment will also contribute to income growth and confidence."

Household spending may bolster economic growth, which will probably reach 4 percent to 4.5 percent this year, Deputy Economic Development Minister Andrei Klepach said last week. A global recovery and reviving local demand have helped enliven Russia's recovery, he said.

The economy contracted a record 7.9 percent last year.

The average monthly wage rose 2.9 percent, compared with February 2009, when the effects of inflation are stripped out. Annual price growth slowed to 7.2 percent last month, the lowest level in nearly 12 years.

Retail sales may rise 3.3 percent in 2010 as inflation slows to between 6.5 percent and 7.5 percent for the year and disposable incomes gain 3 percent, according to the government's forecasts published Dec. 30.