Consumer sentiment improved slightly in October 2023. The increase in confidence is noticeable in all socio-demographic groups, however, this did not affect the willingness to make large purchases.

Consumer sentiment improved in October 2023 after the summer recession. It is characteristic that positive changes have affected both assessments of the current and future financial situation, which indicates some improvement in material well-being. This may partly be due to the strengthening of the ruble and government measures to curb prices. The absence of significant negative news contributes to the improvement of consumer sentiment.

The sentiment improved in all major socio-demographic groups, regardless of age, the size of the settlement, financial status and even attitude to the state of affairs in the country. If we talk about long-term trends, then the group of “skeptics” (those who believe that things in the country are moving in the wrong direction) mostly rely on themselves and express confidence in the prosperous future of their family, strengthened after 2018. This is noticeable on the right side of the graph: the forecast of “skeptics” for the future of their family is more prosperous than the expectation of changes in the country’s economy; this is how they differ from those Russians who approve of the trajectory of the country.  Among those who approve of the state of affairs in the country, hopes for the collective future of society are traditionally stronger than personal ones.

Despite a noticeable improvement in sentiment in all age groups, it is important to note that expectations of material wellbeing have grown especially among the youth, and estimates of the country’s future on the horizon of 12 months – in the group from 18 to 39 years. It is worth noting that the size of the group of respondents aged 18-24 is relatively small (less than 9% in the national sample), so changes in attitudes in this group cannot significantly change the all-Russian trends. The growth of the index is determined primarily by the sentiment expressed by the older age groups.

The index of purchases on credit continues to recover after a prolonged decline in 2018-2022. However, this recovery is slow. Over the past year, the index has strengthened by only 3 points.

The limited growth potential of the index of large purchases is clearly visible on the example of the real estate and car markets. 23% of Russians rate the current time as favorable for buying a home (30% consider it neither good nor bad, 37% – bad). Regarding the car market, estimates are even more skeptical: only 18% believe that now is a good time to buy a car (27% consider it not good, but not bad; 44% – bad).

Over the past six months, the consumer strategies of Russians have hardly changed. Respondents prefer to postpone large purchases (40%), and 35% do not plan them.

Respondents were asked how they are willing to dispose of additional funds in the amount of 1) their monthly family income, 2) their six monthly family income.

If they receive an additional monthly income, 23% of Russians will spend it on everyday purchases (10% on food, 13% on clothes and shoes), and 24% – on large purchases for a house (18%), a car or an apartment (6%). If they receive an additional six-month income, the spending structure changes. In this case, respondents are more likely to make large purchases (an increase from 24% to 36%), and the share of respondents who have invested in savings will also increase from 19% to 25%.

IF YOU RECEIVED ADDITIONAL MONEY IN THE AMOUNT OF YOUR FAMILY’S INCOME…, WHAT WOULD YOU SPEND IT ON IN THE FIRST PLACE? (in %)

Additional funds change consumer and savings behavior in all observed consumer groups. In this case, respondents spend less on basic needs, but save more for large acquisitions and savings. At the same time, spending on human capital – education, medicine and health – will be equal in all three groups.

Respondents who were previously willing to spend additional funds on consumption, with an increase in additional income, “move” to a higher consumer category and begin to think about large purchases. Interestingly, the relative majority (42%) of those who planned to spend money on their vacation, self-development or health, do not plan to significantly change their plans, remaining in the same category. The majority (57%) of those who, even with less additional income, planned to send funds to savings, still tend to save.

CHANGES IN CONSUMER AND SAVINGS BEHAVIOR (in %)