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Why Russia’s Services PMI Weakened in May 2018

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Russia’s services PMI in May 2018

According to a report by Markit Economics, Russia’s service PMI weakened in May as compared to April. It stood at 54.1 in May as compared to 55.5 in April. The PMI figure didn’t beat the preliminary market expectation of 54.5.

The softer rise in Russia’s service PMI in May was mainly due to the following factors:

  • Production output and volume rose at a weaker pace in May 2018.
  • New orders and export orders in the service sector also weakened in that month.
  • The employment in the service sector was also the weakest in 17 months.

In the previous part of this series, we discussed that the manufacturing activity of Russia witnessed a weaker improvement in May. The rising trade uncertainty and cost of raw materials affected the overall economy during the month. Higher inflation affected consumers’ buying activity and the overall economic activity in May 2018.

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Performance of various ETFs in May 2018

The iShares MSCI Russia Capped ETF (ERUS), which tracks the performance of Russia’s economy (RSX), rose 1.1% in May. However, the VanEck Vectors Russia Small-Cap ETF (RSXJ) fell 0.8% in the same month. In the next part of this series, we’ll analyze the performance of Brazil’s manufacturing PMI in May 2018.

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