Russia PMI January 2020


Russia: Manufacturing PMI improves slightly in January

February 3, 2020

The Russia IHS Markit Manufacturing PMI rose to 47.9 in January, from 47.5 in December, marking the best result since August 2019. However, the index remained below the critical 50-threshold, suggesting that activity in the manufacturing sector contracted for a ninth consecutive month at the beginning of 2020.

The overall result chiefly reflected sustained decline in new business which felt the pain of weak domestic and foreign client demand. On top of that, manufacturing output continued to fall in January amid consumers’ weak purchasing power, although the rate of contraction was the softest in five months. Meanwhile, on the price front, inflationary pressures were subdued in January with output charges rising only marginally at the beginning of 2020.

Commenting on the report, Sian Jones, an economist at IHS Markit, noted:

"Russian manufacturers started 2020 on a low note […] demand remained weak as firms struggled to kickstart a boost in sales, resulting in a further reduction in their workforce numbers. Manufacturers do foresee an improvement over the coming year, however, with business confidence picking up in January. Our current forecast for industrial production growth in the opening three months of 2020 is just under 2% compared to the same period a year ago, with the expansion set to gradually quicken as the year progresses."

FocusEconomics Consensus Forecast panelists project fixed investment will expand 3.0% in 2020, which is down 0.1 percentage points from last month’s forecast. In 2021, the panel expects fixed investment to also grow 3.3%.

Author:, Research Team Manager

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