Russians cut Spendings as inflation bites

Jan 28, 2016 Russia’s national currency recently extended its losses due to failing world oil prices, forcing Muscovites to carefully consider every purchase they make.

Aleksander, a mobile phones merchant, said his business is struggling under the shortage of customers, who are spending less.

“People try to save money. I do not know how the situation will develop. So there are fewer clients now. Respectively, people started buying less, they save up,”

Russia’s currency slid to 80 roubles per dollar, before slightly recovering.

Many Russians, having spent months already watching the value of the roubles in their pockets fall against the dollar, have adopted a fresh approach to the currency’s decline.

Irina Lobanova, Head of bank sector research department at the National Financial Research Agency, said:

“Consumption structure and consumers’ requests for goods and services will change. People will pay more attention to cheaper goods and trademarks and so on. All in all, undoubtedly consumer market will fall, because purchasing power decreases, income decreases. The companies and businesses which adapt to these conditions will survive,”