Page 45 - bne IntelliNews Russia OUTLOOK 2025

Russia’s manufacturing and service sectors reported modest growth at the close of 2024 but also indicate a clear slowdown in economic activity as the stress caused by the war in Ukraine begins to take its toll.
According to the Purchasing Managers’ Index (PMI) data from S&P Global, both services and manufacturing sectors expanded in December, but the pace of growth decelerated, reflecting subdued client demand, material shortages and rising costs that continue to weigh on business activity.
The S&P Global Russia Composite PMI Output Index dropped to 51.1 in December from 52.6 in November, indicating a slower and marginal expansion.
“Supply chain challenges and the prospect of higher input costs prompted firms to increase purchases, but workforce reductions and dented business confidence remain concerns,” S&P Global noted in its report.
The Russia Manufacturing PMI slipped to 50.8 in December, down from 51.3 in November, marking only a marginal improvement in operating conditions. While new orders continued to grow, the pace was modest and below the long-term trend. Export orders, buoyed by trade with neighbouring countries, outpaced domestic sales but still reflected slowing momentum.
Manufacturers faced persistent inflationary pressures, with input costs rising at their second-highest rate since October 2023. Currency fluctuations and material price hikes were significant contributors.
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