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Russian services activity grows in Sept for eighth month running -PMI

Published 04/10/2023, 07:08
Updated 04/10/2023, 07:10
© Reuters. FILE PHOTO: A woman looks on as she waits at a Chinese restaurant in Moscow, Russia March 13, 2023. REUTERS/Maxim Shemetov/File Photo
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(Reuters) - Activity in Russia's services sector expanded for the eighth month running in September, boosted by a sustained rise in client demand and new export orders, which rose at their fastest pace on record, a business survey showed on Wednesday.

The S&P Global Purchasing Managers' Index (PMI) for Russian services fell to 55.4 in September from 57.6 in August, but stayed far above the 50 mark that separates expansion from contraction for the eighth consecutive month.

"Although expansions in output and new orders slowed on the month, the rates of growth remained sharp overall thanks to a sustained uptick in client demand," S&P Global said.

Russian firms' export business has struggled while Moscow has been conducting what it calls a "special military operation" in Ukraine. But new export orders grew for the fifth month running - and at their fastest pace in the nine years on record for that indicator.

"New export orders expanded at a survey-record rate amid reports of successful outreach to new customers," S&P Global said.

Russia's weakening rouble has added to inflationary pressure in recent months, forcing the central bank into a series of interest rate hikes to 13%. Analysts polled by Reuters expect the Bank of Russia to raise the cost of borrowing again later this month.

© Reuters. FILE PHOTO: A woman looks on as she waits at a Chinese restaurant in Moscow, Russia March 13, 2023. REUTERS/Maxim Shemetov/File Photo

"Inflationary pressures remained historically elevated in September," S&P Global said. "Input prices rose in line with higher wage bills, greater costs to service loans and exchange rate weakness."

A sister survey on Monday showed activity in Russian manufacturing grew at its fastest pace in more than six years in September, while employment in the sector rose at its quickest rate in over two decades.

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