MOSCOW, Dec 30 (PRIME) -- Russia's Manufacturing Purchasing Managers' Index (PMI) grew to 49.7 in December from 46.3 in November, below the 50 no-change mark, which signals an overall decline, researcher Markit said on Wednesday.
“December PMI data signalled a further, albeit only fractional, decline in the health of the Russian manufacturing sector. As well as slower contractions in production and new orders, the headline figure was pushed higher by substantial supply chain disruption. The deterioration in vendor performance led to an accelerated and robust rate of input price inflation, it said.
Output continued to decline across the Russian goods-producing sector in December, as subdued client demand weighed further on production. But the pace of the downturn softened and was the slowest in the current three-month sequence of contraction.
The rate of input price inflation accelerated again, and was the quickest for almost six years. Higher cost burdens were often attributed to supplier shortages and unfavourable exchange rate movements.
Output expectations strengthened in December amid hopes of the release of pent-up demand as 2021 progresses. The degree of confidence was at its highest since August and was relatively strong.
"Russian manufacturing sector showed encouraging signs of moving towards stabilization in December, as the declines in output and new orders softened. Tougher global demand conditions following increasing national lockdowns were reflected in slower new export order growth, however," Sian Jones, economist at IHS Markit, said, as cited in the statement.
"A more pressing concern was the escalation in supply chain disruption during December. Supplier shortages and delays resulted in robust cost inflation, the rate of which has not been seen for almost six years. Although firms partially passed on higher input prices, the pace of charge inflation was far surpassed by the increase in costs. Despite such marked rises in prices, the annual rate of inflation is expected to remain below the Central Bank of Russia's target of 4%, owing largely to weak domestic demand conditions.”
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