MNI Indicators poll suggests business sentiment in Russia has gone up markedly

By Andrei Skvarsky.

Monthly surveys by Deutsche Boerse-owned research company MNI Indicators suggest that Russian companies were by and large doing better in March than in February and that overall business sentiment in Russia went up with optimists and pessimists making up roughly equal proportions of the country’s business community.

Loans were easier to obtain in March, according to the returns of a poll in which MNI Indicators questioned executives in about 200 companies practically throughout the Russian economy.

Executives in half the firms that were interviewed in the survey said borrowing was easier in March. This appeared to be a mitigation of the effects of the West’s anti-Russian sanctions, which among other things limited Russian companies’ access to Western financial markets.

The current financial position of slightly more than half of the companies covered by the poll improved during March, MNI Indicators said in a statement.

Companies were receiving more orders and increased their production.

“Following the hint of a recovery displayed towards the end of last month, momentum followed through into March as the rouble appreciated further against the dollar and oil prices surpassed $40 per barrel for the first time since December,” the statement reads in part.

“There was renewed confidence in the rouble,” it says.

The MNI Russia Business Sentiment Indicator, an index updated monthly on the basis of the surveys, “increased for the second consecutive month in March pushing it back just above the average of the past year”, said MNI Indicators chief economist Philip Uglow.

“Alongside an improvement in both orders and output, the picture is certainly less gloomy than the past two months. The continued increase in the oil price should help in the future, although for now most elements of the survey remain at depressed levels,” Uglow said.

Vladimir Panyushin, chief strategist of Sberbank CIB, the investment arm of Russia’s biggest lender Sberbank, argued early in March that oil prices and the rouble, which had begun to climb by that time, were likely to dip again, possibly in the second quarter of 2016, but would resume their ascent.

The companies surveyed in the two-year MNI Russia Business Sentiment polls are listed on Moscow Exchange and are a mix of manufacturing, service, construction and agricultural firms.

The polls are computer-aided telephone interviews with around 200 companies surveyed each month.

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