Russia’s Virus Pain Deepens With Worst-Ever Drop in Retail Sales

(Bloomberg) -- Russia’s retail sales plunged the most since records began in the latest sign that the government’s cautious stimulus program has done little to soften the economic blow from the coronavirus lockdown.

Retail sales fell 23% in April, compared with the same period a year ago, Russia’s statistics agency said on Tuesday. The median estimate in a Bloomberg survey had forecast an 18% drop. Construction was down 2.3% and cargo shipments declined 6%.

The unemployment rate jumped to 5.8%, the highest level in four years, after 815,000 lost their jobs in April, the data show.

The government of the world’s biggest energy exporter has been reluctant to dig deep into its $168 billion rainy-day fund to stimulate the economy in case the slump in global demand for oil persists. The International Monetary Fund forecast last month that Russia’s contraction this year will be more than twice that of the world as a whole, while a recovery next year will be smaller.

Overall output shrank by a quarter last month as Russia’s pandemic lockdown limited economic activity and slashed incomes, according to Bloomberg Economics estimates based on Finance Ministry data. Central bank Governor Elvira Nabiullina warned last week that a contraction in the second quarter may exceed 8%.

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President Vladimir Putin ended Russia’s stay-at-home regime at the beginning of the month in an attempt to limit the economic impact. Moscow and some other major cities remain in lockdown, though Putin said Tuesday that the epidemic has passed its peak.

Car sales dropped 72%, making last month “black April,” according to the Association of European Businesses. A manufacturing indicator slumped to the lowest level since records began in 1997, IHS Markit reported at end of last month.

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