Page 91 - RUSRptApr17

Services has also pulled up the composite index to 56.3 in March from 55.4 in February, but that is off a very strong January figure of 58.3 which has been the peak value in the last two years.
In general the composite PMI was below the 50 no-change market for almost all of 2015 but moved into positive territory in 2016, apart from a brief respite in July, and was clearly building momentum in the last four months of last year ending 2016 at 56.6.
These results fit with the government’s predictions for 1.5%-2% growth this year after the economy returned to growth in the last quarter of 2016 of 0.3%, ending seven consecutive quarters of recession – the first of president Vladimir Putin administration. All of this has lead IHS Markit to upgrade Russia to investment grade.
The international rating agency Standard & Poor's (S&P) still has Russia rated as “junk,” but raised the outlook for Russia's sovereign credit rating to "positive" from "stable" in March, confirming its long-term foreign currency credit rating at "BB +" which is one notch below the sought after investment grade. At the same time, the long-term credit rating in the national currency was affirmed at "BBB-". Moody’s Investors Service ranks the country at the same level, while Fitch Ratings is the only one of the major ratings agencies that has maintained Russia’s investment grade rating, which it first obtained in 2003.
S&P, which raised Russia’s outlook to stable from negative in September 2016, cited stabilizing growth in gross domestic product for its latest decision. “External pressures appear to have abated significantly over the last 12-18 months,” S&P said in a statement. “The positive outlook indicates that we may raise our ratings if the Russian economy continues to adapt to the relatively low oil-price environment while maintaining its strong net external asset position and comparatively low net general government debt burden.”
IHS Markit concurs and highlights the recent rise in oil prices from around $40 a barrel to consistent prices over $50 since Russia signed up to and stuck to a OPEC brokered production cut deal have bolstered Russia’s case.
91 RUSSIA Country Report April 2017 www.intellinews.com