MOSCOW: Growth in Russia's services sector slowed slightly in September as new business expanded only modestly and companies became more pessimistic about future orders, a business survey showed on Thursday.
HSBC's Purchasing Managers Index for Russian services stood at 51.5 in September on a seasonally adjusted basis, down from 51.8 in August.
Readings above 50.0 indicate expansion. Only 37 per cent of the polled companies saw their business growing over the coming year, down from 44 per cent in August - among the weakest results over the last five years.
The modest growth of the service sector, which accounts for about 60 per cent of Russia's gross domestic product, follows data showing that the manufacturing sector shrank again in September.
"The survey confirmed that the Russian economy was growing below its potential and will likely continue to accumulate a negative output gap in the coming months," said Alexander Morozov, chief economist for Russia and CIS at HSBC.
The volume of new business received by Russian service providers rose for the third month running in September. The corresponding sub-index was little changed at 50.5 versus 50.6 in August. Lack of new orders prompted the companies to shed staff.
Employment in the service sector declined for the second time in three months. Lower employment could weigh on consumer demand, the key driver of Russia's economic growth, in the short term.
However, the labour market is still tight and the layoffs signal an improvement in productivity in the longer term, Morozov added.
indiatimes.com
HSBC's Purchasing Managers Index for Russian services stood at 51.5 in September on a seasonally adjusted basis, down from 51.8 in August.
Readings above 50.0 indicate expansion. Only 37 per cent of the polled companies saw their business growing over the coming year, down from 44 per cent in August - among the weakest results over the last five years.
The modest growth of the service sector, which accounts for about 60 per cent of Russia's gross domestic product, follows data showing that the manufacturing sector shrank again in September.
"The survey confirmed that the Russian economy was growing below its potential and will likely continue to accumulate a negative output gap in the coming months," said Alexander Morozov, chief economist for Russia and CIS at HSBC.
The volume of new business received by Russian service providers rose for the third month running in September. The corresponding sub-index was little changed at 50.5 versus 50.6 in August. Lack of new orders prompted the companies to shed staff.
Employment in the service sector declined for the second time in three months. Lower employment could weigh on consumer demand, the key driver of Russia's economic growth, in the short term.
However, the labour market is still tight and the layoffs signal an improvement in productivity in the longer term, Morozov added.
indiatimes.com
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