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December Russia PMI indicates strongest manufacturing growth since July

Staff Writer | December 28, 2017
December survey data signalled a solid improvement in operating conditions in the Russian manufacturing sector.
Russian manufacturing
Russia   IHS Markit Russia Manufacturing PMI
A stronger overall upturn was supported by accelerated growth in output and new orders.

That said, backlogs contracted for the fourth consecutive month and employment levels were broadly unchanged.

Meanwhile, inflationary pressures remained muted in the context of the series history, with rates of both input price and charge inflation softening despite supplier constraints delaying delivery times further.

In line with more favourable demand conditions, business confidence was robust and reached a three-month high.

The seasonally adjusted IHS Markit Russia Manufacturing Purchasing Managers’ IndexTM (PMI ) – a composite single-figure snapshot of the performance of the manufacturing economy – posted 52.0 in December, up from 51.5 in November.

The latest index reading signalled solid growth across the Russian manufacturing sector and reached a five-month high.

The latest PMI was in line with the average for 2017 as a whole.

Production levels at Russian manufacturers increased further in December.

Moreover, the pace of expansion accelerated to reach a four-month high.

Anecdotal evidence attributed strong output growth to greater new order volumes and more efficient production processes.

Greater demand from new and existing clients supported a solid increase in new orders received by Russian goods producers.

Furthermore, the rate of growth quickened and was the fastest since July.

Export sales, however, contracted for the first time since August, albeit only marginally.

On the price front, cost burdens faced by manufacturers rose further with panellists attributing inflation to higher raw materials prices and supplier shortages.

The rate of inflation eased to a fourmonth low despite vendor performance deteriorating to the greatest extent since July 2016.

Average prices charged also increased at a muted pace, with the rate of inflation softening to a fivemonth low.

Despite a solid upturn in new orders, backlogs contracted for the fourth successive month in December.

Panellists linked the fall in outstanding business to more efficient production processes.