Russian factory activity expands at fastest rate in Sept since 2019 - PMI

BY Reuters | ECONOMIC | 10/03/22 02:04 AM EDT

MOSCOW (Reuters) -Russian manufacturing activity grew at its fastest rate in 3-1/2 years in September, driven by rises in production, new orders and client demand, a business survey showed on Monday, though Western sanctions continued to weigh on export business.

The S&P Global Purchasing Managers' Index (PMI) rose in September to 52.0 from 51.7 in the previous month, climbing higher above the 50.0 mark that separates expansion from contraction to its highest point since March 2019.

"Client demand was focused on domestic customers, however, as new export orders declined steeply," S&P Global said in a monthly survey. "The decrease in foreign client demand was attributed to the loss of customers and the impact of sanctions."

The United States and European Union last week promised to impose more sanctions on Moscow after Russia staged referendums in four Ukrainian regions and later declared that it was annexing them.

Western governments and Kyiv said the move was a breach of international law.

Employment rose at the fastest pace since January, which firms attributed to greater production requirements and a rise in new order inflows.

It was not clear how heavily President Vladimir Putin's partial mobilisation order, made on Sept. 21, had weighed on workforce numbers. Tens of thousands of men have been drafted into the army or have fled abroad since then.

The same could be said for sentiment about future output, which rose in September to its highest since March 2019.

"Greater optimism reportedly stemmed from new product development, greater import substitution and hopes of an uptick in client demand," S&P Global said.

(Reporting by Alexander Marrow; Editing by Hugh Lawson and Toby Chopra)

In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

fir_news_article