FX.co ★ Russia Manufacturing Growth Slowest In 6 Months

Russia's manufacturing sector saw its slowest expansion in six months, with a slowdown in growth for both output and new orders, according to the latest survey results from S&P Global released on Thursday.

The Manufacturing Purchasing Managers' Index (PMI) fell to 53.6 in July, down from 54.9 in June. Despite this decline, a PMI reading above 50 still signals growth in the sector.

While new orders continued to increase in July due to ongoing improvements in demand conditions and new client acquisitions, the rate of growth slowed to its weakest in a year. At the same time, new export orders experienced a renewed decline in July, attributed to weaker demand from major export markets.

Consistent with the slower rise in new orders, the expansion in production also softened, marking the weakest growth since January.

On the pricing front, input price inflation accelerated to its highest level since October 2023, driven by higher costs for raw materials, transportation, supplier charges, and unfavorable exchange rate movements. Consequently, firms raised their selling prices.

As a result, companies moderated their expansions in both employment and input purchasing in July. Nevertheless, manufacturers remained optimistic about output growth over the next twelve months, backed by investments in new machinery, product development, and expectations of stronger demand conditions.