5/11/20: BRIC: Services PMIs October

In the earlier post, I covered BRIC economies manufacturing PMIs for October: https://trueeconomics.blogspot.com/2020/11/31120-bric-manufacturing-pmis-october.html. Now, leet's take a look at Services PMI.

As the chart above illustrates:
  • Brazil Services PMI rose from 47.5 in 3Q 2020 to 52.3 in October. Prior to October, Brazil's services sector was in a contractionary territory for three consecutive quarters. October marks the second month of above 50.0 readings, although statistically-speaking, September reading was indistinguishable from 50.0 stagnation / zero growth level.
  • Russian Services PMI posted a sharp contraction, falling from 56.8 in 3Q 2020 to 46.9 in October. Russia enjoyed just three months of > 50.0 readings in July-September 2020, implying that the economy is nowhere near a V-shaped recovery from the pandemic and that things are getting worse, not better in the services sectors. Even worse dynamics apply to Manufacturing where Russia has not seen sustained > 50 readings since March 2019.
  • India Services PMI rose to 54.1 in October, marking the first month of above 50.0 readings since February 2020. Given cumulative nature of the PMIs, October rebound is nowhere near being sizeable enough to start closing the pandemic-induced drop-off in economic activity. India's services have now posted seven months of contraction in 2020, compared to four months for Manufacturing. October marks the first month since February with both indices above 50.0.
  • Chinese Services PMI rose to 56.8 in October, compared to 54.8 in September, marking 6th consecutive month of both Manufacturing and Services PMIs above 50.0 line. 
Overall, BRIC Services Activity Index (a measure of Services sectors activity calculated by me based on monthly Markit PMI data and country-specific share of the world GDP, PPP-adjusted) rose to 54.9 in October compared to 51.0 in 3Q 2020, marking a second month of > 50.0 readings and accelerating growth momentum. October BRIC reading is in excess of the Global Services PMI reading of 52.9, implying that as a group, BRIC economies are contributing positively to global economic growth momentum, although both Brazil and Russia are pushing BRIC reading down, compared to Global Services PMI.