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Why Russia’s Manufacturing PMI Weakened in October 2017

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Russia’s manufacturing PMI in October

According to a report by Markit Economics, the final Russia Manufacturing PMI (purchasing managers’ index) fell marginally in October as compared to September 2017. It was at 51.1 in October 2017 as compared to 51.9 in September. The October figure didn’t meet the preliminary market estimate of 51.5.

The weaker performance in Russia’s manufacturing PMI in October was mainly due to the following factors:

  • Production volume and output showed weaker improvement in that month.
  • New business orders slowed and factory output also weakened during the month.
  • Export orders rose the most since November 2011.
  • Job growth in the manufacturing sector also improved.
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The weaker improvement in the manufacturing activity suggests that domestic demand weakened in October 2017. The business sentiment index also softened in the same month. The fall in client demand hampered the business sentiment. Consumers’ buying activity also softened for the first time since July 2016.

Performance of various ETFs 

The VanEck Vectors Russia ETF (RSX), which tracks the performance of Russia, fell 2.2% in October 2017. The Direxion Daily Russia Bull 3X ETF (RUSL) fell 6% in the same month.

In the next part of this series, we’ll look at the services PMI for Russia in October 2017.

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