MOSCOW The economic mood of the Muscovites interviewed by is quite calm. No one says that they had to save especially, and the rise in prices has not seemed unusual.
– Every ten years, a revolution happens here in Russia. We are used to it, psychologist and trauma therapist Kseniya says in Moscow.
Russia’s “military special operation”, i.e. the war against Ukraine, weighs on the mind.
– Of course, this situation has affected everyone. Financially, it has touched a little less than psychologically, the 35-year-old Dmitri says. He lives in the suburbs of Moscow.
We only use the first names of the interviewees in the story. Economic issues are also tense in a country at war.
Expectations of economic difficulties were much steeper when Western countries responded with extensive sanctions to Russia’s attack on Ukraine launched in February.
In Moscow, the authorities also try to keep the population happy and protect citizens from economic fluctuations perhaps more than in other regions of Russia.
Visible outbursts of discontent are not wanted in the capital.
The Russian economy has fared much better than expected under the sanctions. Last year, the economy shrank by only 2.2 percent. This will not empty Russia’s war coffers yet.
Even last spring, the Russian economy expected (you switch to another service) shrinking by 7–8 percent, possibly more.
Now the International Monetary Fund (IMF) predicts that the Russian economy will even grow by 0.3 percent this year.
The psychological pressure is felt more than the economy
35-year-old Dmitri works as an entrepreneur, his company manufactures playing fields, for example for ice hockey. There have been slightly fewer orders in the economy, but the basic reason for the concern is internal.
– In the beginning, it was especially difficult when everyone accused us as if we were the worst, and you were part of it, even though you had done nothing, Dmitri says.
The residents of the capital region we interviewed did not yet feel that they had to save more than usual.
Consumer demand of Russians has decreased: NielsenIQ market research institute by (you switch to another service) last year the demand for consumer goods fell the most since 2014–15.
When the rise in prices is excluded, demand shrank by 3.4 percent, according to the research institute.
Russians’ real incomes have fallen. The embargo period has also caused changes to supply chains and selections.
Uncertain times continue, which is likely to increase savings.
The price increase is not particularly shocking
Inflation was at its highest in April, but leveled off at the end of the year. Russians are used to rising prices.
– When last year our family spent 35,000–40,000 rubles per month (450–500 euros) on food, now it is around 50,000 rubles (640 euros), Ksenija estimates.
Dmitri says that he tries to follow a simple and balanced diet. For example, the prices of rice, milk, eggs and rice have not changed much.
A lot of dairy products now come from Belarus, and according to Dmitri, they are tasty and cheap.
– Prices have risen but not critically, there hasn’t been a huge leap, says Dmitri.
A pensioner agrees Nina Petrovna in Moscow.
– In general, I wouldn’t say that there is anything to complain about as a pensioner. Municipal services became the most expensive. We can thank the government that food has remained at normal and reasonable prices, says Nina Petrovna.
Last spring, shortly after the “special operation” was declared, flour, cornmeal and sugar disappeared from the shelves momentarily as people rushed to stockpile goods.
Also, for example, hygiene products and home appliances were sold out in many places, when Russians were afraid that imported products would disappear.
Since then, the situation calmed down and these products are available as usual.
Sanctions and the withdrawal of Western companies are felt in some products.
There has been a shortage of car spare parts, and car lubricating oil became the most expensive, Dmitri, who works as an entrepreneur, says.
The prices of medicines have risen significantly, Nina Petrovna says.
His pension is 35,000 rubles, which according to the official exchange rate of the ruble is about 450 euros per month. 5,000 rubles will be spent on medicines. The disappearance of Western symbols is treated calmly.
Brands left Russia
– The departure of Western brands does not scare us at all, says psychologist Ksenija.
– Ikea is now being successfully replaced by our furniture factory and you can buy from them even cheaper.
Clothing stores like Zara and H&M left Russia. Ksenija that she found a store of a Turkish clothing brand instead of Zara.
Coca-Cola and Pepsi are no longer sold in Russia, but according to Dmitri, numerous local brands have taken their place: In five different stores you can find three different colas and all of them are different.
Italian wine, Chianti, has become more expensive and there are fewer brands, but you can drink Georgian wine instead, Dmitri says.
– It’s great and costs the same as before, says Dmitri.
– It is a pity that whiskey has run out in Russia. There is no longer that and no German beer, Ksenija, on the other hand, laughs.
The departure of Western car manufacturers has made room for Chinese cars in the market. Dmitri hopes that the situation would stimulate Russia’s own car production.
The party is over
The ordinary year has started, and the New Year’s celebrations are behind us.
Instead of Christmas, Russian celebrations focus on the New Year, and that has traditionally included a large festive meal.
Dmitri says that he and his wife don’t usually prepare a huge New Year’s table for days.
– I can’t say that I saved money, Dmitri says and guesses that he spent even more money than last year.
The red caviar had become more expensive. Dmitri thinks that the speculators had decided to make a bigger account than usual.
Nina Petrovna says that she also went to the store of the French chain Auchan (Asha in Russian) with her retired sister.
– Everything was there. We got our pensions and went with him. There we bought everything ready, sausage, salads, aladob. We spent money, of course, but everything was reasonably priced, Nina Petrovna says and says that even the sparkling wine had not become more expensive.
Nina Petrovna says that she has not noticed any shortage of products in her everyday life. He himself once worked at GUM, a large department store in the center of Moscow. As a former trade professional, he does not feel that he sees any shortage: there is enough food, there are no queues.
– The nation has been calm when it comes to food. The soul hurts because of all this, but there is food as usual, says Nina Petrovna.
– If only there was money. Many are now talking about reducing the workforce and leaving people unemployed. That’s bad. It’s easier to be alone, but the family has to be fed, he reflects.