MOSCOW Russian consumers continue to struggle in the second year of a recession, with official data showing on Monday that the amount of real disposable income people had in August fell at the fastest pace in seven years.
Real disposable income has been falling since 2014 when Russia was hit by Western sanctions over its role in the Ukraine crisis, but the 9.3 percent decline, in annual terms, was the steepest since August 2009, the aftermath of the global financial crisis.
Real income, adjusted for inflation, also declined, by 1 percent, after showing some positive signs earlier this summer, according to the data from the Federal Statistics Service, or Rosstat.
With less money to spend, consumers also stayed away from shopping, with retail sales, a barometer of customer demand in Russia, down 5.1 percent in August and following a 5.2 percent decline in July.
While the data suggest that the impact of customer spending on inflation diminishes, it also clouds the prospect of an economic recovery, with consumer demand traditionally a big growth factor.
Russia's gross domestic product is expected to contract about 0.5-0.6 percent this year before returning to moderate growth of 0.6-0.8 percent next year..
The consumer pain has done nothing to dim the popularity of the Vladimir Putin's United Russia party, which was on course for its largest majority after the weekend's election, although critics noted a sharp fall in turnout.
The central bank cut its key rate on Friday, but promised tight monetary policy until the end of the year and until its target of 4 percent inflation, hoped to be achieved next year, becomes sustainable.
Overall data for August showed some improvements, with industrial output expanding by 0.7 percent after a small contraction in July and a stable and low unemployment.
"Russian activity data for August suggest that the economy continued to pull out of its slump, albeit very slowly," Liza Ermolenko, an economist at Capital Economics in London, wrote in a note.
"The recovery is still being driven by industry, but there are no signs of improvement in consumer-facing sectors."
(Reporting by Lidia Kelly; Editing by Dmitry Solovyov and Alison Williams)