The Consumer Activity Index developed by us shows during which period there was an increase in demand and how consumer activity changed relative to the peak values of the previous period.
So, in 2021, demand growth has been observed only since the second half of the year. The Index’s indicators during this period began to exceed the threshold value, which indicates a recovering economic activity in the country after a period of lockdowns and border closures.
Consumer activity noticeably fell due to the January events at the beginning of this year, but then the demand recovered quite quickly and activity was within the optimum. The first peak, exceeding the maximum values of consumption last year, was at the end of March. And in our opinion, this is connected with the celebration of Nauryz and long weekends.
Consumption has been sustainably growing since the summer period and the Index has become strongly above the maximum of last year (the value corresponding to 100%). All this is happening against the backdrop of rising inflation. Thus, the growth we observe may lead to an inflationary spiral in the economy. In our opinion, the national currency weakening and increasing inflation expectations could also contribute to this, which affects people’s behavior and their desire to buy more goods now while prices have not yet risen.
And since the peak values historically fall in September and December, we can suggest the subsequent increase in demand from the population, which will continue to put pressure on prices.