SberIndex: demand for services shifts into higher gear
Between March 22 and 28, 2021, consumer spending added 2.0% y-o-y. A dramatic improvement in the spending dynamics is being observed in the service sector, where spending deviated from the trend by ‘only’ 7.1%, up from –13.0% a week before that. The demand for cultural events was higher than over the same stretch in 2019. Meanwhile, SberIndex analysts claim the volatility of consumption estimates is still extremely high, which is due to spikes in the size and structure of demand observed in the second half of March 2020.
The dynamics are being negatively impacted by the base effect, which affected practically all segments of products during the week in question. Lockdown was announced on March 25, 2020, and people flocked to snap up the basic necessity goods ahead of it. There was a boom in demand for a wide variety of categories, such as food items, construction and home improvement goods, and gasoline.
Nominal spending free of base effect deviations has a growth rate of 4.5–4.8% y-o-y.
It would now be meaningless to analyze nominal growth rates in the service sector, which is formally up 31.2% y-o-y after a major slowdown in March 2020. As for Airline Tickets, Duty Free Stores, and Travel Agencies, spending is growing exponentially.
In times like that, it’s vital to track deviations from the linear trend when it comes to demand estimations. The consumer activity index was slightly under the 2021 highs standing at 72.0 points last week.
The Federal State Statistics Service’s (Rosstat) data on consumer spending in February generally coincided with SberIndex estimates (+3.1% according to Rosstat; +2.6% according to our estimates).
Amid the coronavirus, the demand for cultural events is lower than in 2020 but is already higher than during the same stretch in 2019. Given the restrictions on the number of visitors now in place, the March 2021 figures should be regarded as high.
When publishing this material, a reference to SberIndex (www.sberindex.ru) is mandatory.SberIndex.ru is SberBank’s analytical portal, illustrating how life in Russia has changed during the COVID-19 pandemic. The website features four key indices based on anonymized data: an incidence model, a consumer activity index, consumer activity changes, and a tourism index. The Business section shows the evolution of gross payroll and changes in small business activity. Other studies by SberIndex lab (formerly SberData) are also available on the website.