Page 38 - RusRPTSept19

Russian service sector registered an acceleration in business activity growth in August, with a faster increase in new orders driving the expansion. External demand also rebounded, despite signalling only a fractional upturn in new export orders.”
"Nevertheless, firms expressed further reluctance to increase employment and a lower degree of optimism towards future output. Many stated that confidence was dented by concerns about the wider economy.”
"At the composite level, data indicated a renewed upturn in new business, despite difficulties in the manufacturing sector. That said, overall output growth was only weak by historical standards and well below the rates of expansion seen at the start of 2019.”
"In line with muted rates of inflation and a relatively modest expansion across the private sector, the Central Bank of Russia may choose to once again cut interest rates in September in an effort to boost consumer demand."
4.3.2 Corporate profits dynamics
Corporate profits remained strong and stable in June, increasing by RUB1,297bn month-on-month to a cumulative RUB8,040bn ($120bn) on a par with the previous months this year, but well ahead of the same months in previous years.
So far this year Russian companies have collectively earned just a bit less than RUB1,300bn every month except in April when they earned RUB1,593bn. In 2017 Russian companies earned over RUB1,000bn in only three months of the year and in April 2017 they earned only RUB523bn.
The pace of growth in profits has also been accelerating, after taking off in the middle of 2018. In the first half of that year profits were growing by around 10% a month y/y but from June 2018 they began to grow by 30% year-on-year and stayed at that level for the rest of the year.
This year the lowest increase in year-on-year profits was in January when they
38 RUSSIA Country Report September 2019 www.intellinews.com