Russian manufacturing output rose again in October, showing its best overall performance since May, according to the latest HSBC Purchasing Managers’ Index data published in the Markit Economics business survey on Thursday.
“The HSBC Russia Manufacturing PMI rose for the second month running in October, posting 52.9. That signaled the best overall operating conditions faced by Russian goods producers in five months, and was greater than the long-run survey average of 52.1,” Markit said in a statement.
HSBC’s PMI is a composite indicator designed to give a single-figure snapshot of operating conditions in the manufacturing economy. An Index above 50 points indicates growth, while below 50 points shows a decline in business activity in the sector.
Manufacturing was boosted by new orders, rising at the fastest rate in over a year-and-a-half.
“Driving the strengthening in overall business conditions in October was a faster increase in new business inflows,” Markit said.
The volume of new work received rose for the thirteenth successive month and at the sharpest pace since March 2011. This occurred despite a slight fall in new export orders, the second contraction of the past three months.
Production growth accelerated to a 19-month high in October, with output supported both through the intake of new orders and the completion of existing workloads. Backlogs continued to fall overall, although at the slowest rate in five months.
Russian manufacturers raised workforce numbers for the third consecutive month in October, mainly to cope with the new work. At the same time, the rate of job creation in the sector showed a slowdown.
“So, domestic demand rules, once again shielding Russia from the headwinds blowing from the struggling eurozone economy. Indeed, despite the ongoing inflation acceleration, private consumption growth remains robust, spurring production of consumer goods and supporting the overall stronger growth momentum in Russia,” HSBC Chief Economist for Russia and CIS Alexander Morozov said.