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Consumer Confidence Gains in Q4

Sentiment on the economy is improving but still far below precrisis levels. Vladimir Filonov
Consumer confidence in the fourth quarter of 2009 rose to the same level as a year earlier, according to data released Thursday, but sentiment has a long way to go before reaching precrisis levels.

The State Statistics Service said its main confidence index increased to negative 20 percent, from negative 25 percent at the end of the third quarter. That compares with a 1 percent figure from the third quarter of 2008, when the global economic crisis was just unfolding.

The index shows the difference between the percentage of respondents who believe that the economy will worsen and those who think that it will improve, excluding neutral responses. The 1 percent figure for the third quarter of 2008 was the highest result since 1998, when the service began conducting quarterly surveys.

The latest survey of 5,000 Russians aged 16 and older, conducted in November, found that 21 percent expected positive changes in the economy, up from 18 percent in the third quarter. Meanwhile, the number of respondents with a negative view of the economy fell to 25 percent, from 29 percent.

The service also recorded an uptick in the number of Russians expecting their personal financial situation to improve in the next 12 months. Thirteen percent responded positively, compared with 11 percent in the third quarter.

Slightly more than half, however, said their financial situation would not change in the coming year.

Analysts said the increases were expected and likely to continue.

"Why wouldn't they go up? In the fourth quarter, we saw clear signs of macroeconomic improvements," said Mark Rubenstein, deputy head of research at Metropol. Russians' "expectations of significant further layoffs were much lower," he said.

With renewed optimism among consumers, retailers may see some increases in sales, probably with electronic and other big-ticket retailers, said Mikhail Krasnoperov, an analyst at Troika Dialog.

The MICEX Index finished Thursday up 1.4 percent, while the exchange's index of consumer-goods stocks slightly outperformed the broader market, closing 2 percent higher.

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