FILE PHOTO: Steam rises from chimneys of a heating power plan over the skyline of central Moscow, Russia November 23, 2020. REUTERS/Maxim Shemetov/File Photo
February 1, 2022
MOSCOW (Reuters) – Russian manufacturing activity expanded in January thanks to new orders and stronger demand that prompted companies to step up hiring, a survey showed on Tuesday.
The Markit Purchasing Managers’ Index (PMI) rose to 51.8 in January from 51.6 in the previous month, above the 50.0 mark that separates expansion from contraction for the fourth month in a row.
“Russian manufacturing firms signalled an encouraging start to 2022 as domestic and foreign client demand conditions improved,” said Sian Jones, a senior economist at IHS Markit, which compiles the survey.
Companies linked a rise in new sales to more robust business and consumer spending.
The pace of job creation in the manufacturing sector was the fastest since November 2018 as the degree of optimism increased to its highest since April, the monthly survey showed.
But inflation accelerated further. Output charge inflation reached a five-month high, while input price growth, or cost inflation, hit a six-month peak.
“As headwinds from higher costs do not look likely to dissipate in the near-term, pressure on margins is expected to persist across the Russian manufacturing sector in 2022,” Jones said.
The Russian central bank is expected to raise rates further as soon as in February to rein in stubbornly high inflation.
(Reporting by Andrey Ostroukh; Editing by Catherine Evans)
