Russian companies reported the lowest degree of confidence since the start of 2018 as the country’s manufacturing activity decreased for the third month in a row in July, Markit purchasing managers’ index showed on Wednesday, according to Reuters.
The index remained below the 50.0 mark that separates expansion from contraction as both output and new orders declined in July. Its headline reading fell to 48.1, its lowest since July 2016, from 49.5 in June.
“July survey data indicated a further deterioration in Russian manufacturing operating conditions… There were also signs of weaker foreign demand as new export orders contracted,” said Sian Jones, an economist at IHS Markit.
“On a positive note, pressure on profit margins eased as input prices rose at the slowest rate since March,” Jones said.
Business confidence remained relatively strong even though it has weakened to a seven-month low, the survey showed. Output fell for the first time since April 2016, amid weaker client demand and a decrease in new orders.
Lower production requirements fed through to a further reduction in workforce numbers, with the decline in backlogs accelerating to the fastest since January 2016. On the price front, rates of input price and output charge inflation softened to the weakest since March.