Wednesday, March 4, 2015

4/3/15: BRIC Services PMIs: Stronger Growth and Russia Divergence


I covered BRIC Manufacturing PMI earlier this week: http://trueeconomics.blogspot.ie/2015/03/2315-bric-manufacturing-pmi-february.html

Now, let's take a look at the Services sectors performance.

  • Russia Services PMI are covered in detail here: http://trueeconomics.blogspot.ie/2015/03/4315-russian-services-and-composite.html
  • Brazil Services PMI came in at a surprising 52.3, breaking four months streak of sub-50 readings and rising strongly up on 48.4 in January. 3mo average through February 2015 is at 49.9 against the 3mo average through November 2014 at 49.3. An improvement on 3mo basis, but down on year ago 3mo average through February 2014 (50.7).
  • China Services PMI came in at 52.0, a slight improvement on relatively weak performance in January (51.8). 3mo average through February is at 52.4 against 3mo average through November 2014 at 53.4 and against 3mo average through February 2014 at 50.9. There is very little of anything spectacular in Chinese data so far.
  • India Services PMI came in at 53.9 a rise on 52.4 in January 2015. On 3mo average basis, current average through February 2015 is at 52.5 against previous 3mo average through November 2014 at 51.2 and against 3mo average through February 2014 at 47.9. 

Summary: Services PMIs have deteriorated over the last five months in Russia and deteriorated very sharply, signalling massive contraction in the Services sectors in the economy, mostly concentrated on financial services. Meanwhile, Services PMIs posted strengthening is India (surprise reversal of downward momentum over October 2014 - January 2015 period). China still showing some weaknesses, but positive growth in the sector, while India is clearly on a rebound with PMIs increasing over the last 3 months and now standing at the highest level since June 2014.



As the above clearly shows, Russia is a major point of divergence for Services sectors within the BRIC economies. This is not new, but the divergence is getting sharper and sharper. We are not yet at 2009 rates and levels of decline, but we are getting there.

Composite BRICs PMIs will be covered in the next post.

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