Russian economy slows

RUSSIA / FSU POLITICS - In Brief 05 Nov 2020 by Alex Teddy
On November 5 the IHS Markit report revealed a large drop in the purchasing managers' index (PMI). The PMI for services fell from 53.7 to 46.9 in October 2020. That is the steepest fall since May 2020. The PMI is highly respected as an economic weathervane. A PMI under 50 means contraction. An unanticipated economic slowdown commenced in late September 2020.Services are doing badly. Manufacturing is feeling the knock on effect going from PMI 48.9 to 46.9 in October 2020. The overall PMI is 47.1 in October. It was 53.7 in September. Coronavirus is partially responsible for the dismal figures. The October decline was not as drastic as April's. In the first week of September coronavirus cases reached 20 000 per day. That is almost twice what it was in March 2020.The government is determined to avoid a second lockdown. Though there are rules about masks and gloves and over 65s staying home.Unemployment was 4.4% in 2019 but was 6.4% in August 2020. The layoffs have been surprisingly few. Businesses say the cost of doing business has risen with the RUB's tumble over the past few months. It has strengthened in the last few days.

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