71% of Firms say Sochi Olympics Good for Business

Sentiment among some of Russia’s largest companies rose for the second consecutive month in February, providing further hope that the economy may be recovering following the sharp downturn seen in 2013.

The MNI Russia Business Indicator increased to 60.0 in February from 57.9 in January, the highest level since May 2013. Part of the recent rise in sentiment is probably due to the Sochi Winter Olympics. Over 70% of respondents said they thought that the winter games have, or will have, a positive impact on their business.

New Orders rose sharply on the month to the highest since June last year, while Order Backlogs hit a series high. Companies were also optimistic about increased orders in the coming three months.

Companies are benefiting from the recent depreciation in the currency. The Effect of the Rouble Exchange Rate Indicator rose to a record high of 61.0 in February as more panellists said the exchange rate was helping their business.

Commenting on the latest survey, Philip Uglow, Chief Economist at MNI Indicators said, “Business sentiment rose again in February, building on the gains seen in January. The Sochi Olympics have probably given confidence a boost although its impact is likely to be short lived.”

“While there are risks that the depreciation in the currency could go too far and too fast, the recent fall should balance Russia’s growth and help domestic producers. Our survey shows that companies are already feeling the benefit of the weaker rouble.”