Russia’s manufacturing PMI returns to growth territory in August

Russia’s headline PMI for August hints at a somewhat upturn in the nation’s manufacturing sector. The survey data showed a marginal rebound in manufacturing operating conditions, improving after hinting at a slowdown in July. Higher new order intakes and modest production growth mainly drove the upturn in the manufacturing sector.

For the fourth time in several months, output at the country’s goods producers expanded. However, the pace of growth was just modest in spite of accelerating since July, noted Markit Economics. Even if manufacturers registered an increase volume of production, companies continued to lower their post-production inventories. Furthermore, finished goods stock has dropped in each of the last 28 months.

The survey data of August hinted at an additional moderate rise in new order intakes in the nation’s manufacturing sector. Additionally, the return to contraction territory comes after a slight contraction in the previous month. In contrast, new export orders dropped in August, expanding the present sequence of contraction that initially began in September 2013.

Manufacturers in Russia reduced their staff in August, with panellists attributing job cuts to attempts to better optimise staff, said Markit Economics. In the meantime, backlogs of work came back into contraction. Furthermore, outstanding business levels have now fallen in 41 of the last 42 months.

The trend of deepening cost pressures continued in August. However, the pace of the rise of input prices slowed to a four-month low. Meanwhile, goods producers in Russia raised their output charges further in August.