Russia PMI

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Russia: Contraction in services eases while manufacturing worsens

April 3, 2015

The HSBC manufacturing Purchasing Managers’ Index (PMI) slipped from 49.7 in February to 48.1 in March. The indicator continues to hover below the 50-threshold that separates expansion from contraction in business activity in the sector. According to HSBC, “The Russian manufacturing sector registered a modest deterioration in operating conditions during March as production and new business both recorded mild declines.”

HSBC also noted that March’s print reflected a deterioration in employment and that backlogs of work continued to fall. That said, respondents to the March survey pointed out that although input and output prices continued to rise, the increase was slower than in the first two months of the year.

Moreover, the services PMI improved in March, rising to 46.1 from 41.3 in February. Despite the improvement, the indicator remains below the 50-threshold, which indicates contraction in the sector. According to HSBC, respondents to the survey signaled that economic conditions are still challenging, which was highlighted by a sharp fall in new business. However, in certain sectors, which are affected by seasonal factors (namely hotels and restaurants), saw modest growth in March. In addition, Russian services providers signaled an increase in optimism that the recent downturn will be transitory, with expectations that business activity will improve in the coming months. HSBC noted that, “companies offered a more upbeat assessment of the future than at any time in the past seven months amid hope of a turnaround in wider economic performance over the coming year.

FocusEconomics Consensus Forecast panelists see fixed investment contracting 2.9% in 2015, which is down 0.7 percentage points from the previous month’s estimate. For 2016, the panel expects fixed investment to increase 2.0%.


Author:, Senior Economist

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Russia PMI March 2015

Note: Markit HSBC Purchasing Managers’ Index (PMI). A reading above 50 indicates an expansion in business activity while a value below 50 points to a contraction.
Source: Markit and HSBC.


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