November has seen the highest pickup in Russia's service sector since January 2017 thanks to a surge in new orders and accelerating business activity, according to Markit Economics data.
The Purchasing Managers' Index (PMI) for the sector grew to 57.4 in November against October's 53.9. Meanwhile, experts had expected the index to decline to 55.0. “The latest index reading indicated steep growth in business activity across the sector that was the second-quickest since May 2011,” the report says.
PMI, an indicator of the economic health of a sector, is based on data compiled after monthly surveys are sent to purchasing executives at nearly 300 companies. The index draws on five major indicators: new orders, inventory levels, production, supplier deliveries and the employment environment. A reading above 50 means expansion in the sector on a monthly basis, anything below indicates contraction.
At the same time, Russia’s Markit PMI – a composite index covering both manufacturing and services – in November grew to 56.3 against 53.2 in October, signaling the fastest composite growth since March.
“November PMI data signaled steep growth in business activity across the Russian service sector, with the expansion accelerating to reach a ten-month high. The upturn in new business also quickened to a sharp rate that was the fastest for the best part of a decade,” said Sian Jones, economist at IHS Markit, commenting on the Russia Services PMI survey data.
“Overall, the IHS Markit Russia Composite Output Index indicated a stronger increase across both manufacturing and service sector firms, with growth in the latest survey period at an eight-month peak,” the analyst added.