Russia’s manufacturing sector in February saw its fastest growth since April 2019. The expansion was underpinned by robust output and new order growth, according to survey data published by IHS Markit on Monday.
The Purchasing Managers’ Index (PMI) for the sector grew to 51.5 in February against January’s 50.9, the research group reports. The pace of decline in export business reportedly slowed, but orders remained robust, while employment grew the most in over two years.
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“Russian manufacturing firms continued to signal a promising start to 2021, as operating conditions improved for the second month running. Output and new order growth accelerated despite difficult external demand conditions,” the report said.
Business confidence returned to levels seen before the Covid-19 pandemic, the highest in over a year.
“Supplier shortages and hikes in transportation costs pushed up input prices markedly. Firms were able to respond, however, with the fastest uptick in charges for six years,” it explained.
However, vendor performance declined at its fastest pace since May 2020 as lead time for inputs were longer, mainly due to shipping delays along with supplier shortages.
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“Our current forecast expects industrial production to rise 4.1 percent in 2021, as the sector seeks to recover from the downturn seen in 2020,” IHS Markit economist Sian Jones said.
PMI, an indicator of the economic health of a sector, is based on data compiled after monthly surveys are sent to purchasing executives at nearly 300 companies. The index draws on five major indicators: new orders, inventory levels, production, supplier deliveries, and the employment environment. A reading above 50 means expansion in the sector on a monthly basis, while anything below 50 indicates contraction.
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