Page 54 - RusRPTFeb24

Although cost burdens in manufacturing continued to increase at a marked pace, the rate of inflation slowed to the weakest in six months.
“Russian manufacturing firms remained strongly optimistic regarding an increase in output over the coming 12 months. Confidence stemmed from planned investment in new products and machinery. The level of positive sentiment was historically elevated despite dropping to a three-month low,” according to the report.
Service providers also commented that greater output stemmed from strong demand conditions and a faster upturn in new business.
Amid stronger domestic and foreign client demand Russian service providers expanded output and workforce numbers at the fastest pace for six months in a bid to relieve pressure on capacity and process incoming new work.
“Anecdotal evidence stated that increased new business was due to the introduction of new service lines, new client acquisitions and improved demand conditions,” according to S&P.
In the same time, input prices for Russian service providers “increased at a substantial pace in December”, with higher costs attributed to greater supplier and utility prices, as well as an uptick in wage bills.
For service provides, positive outlook in December 2023 was linked to hopes of further growth in new business and investment in advertising. “Although firms remained strongly optimistic regarding the outlook for output over the coming year, the degree of confidence slipped to a four-month low in December,” according to the report.
54 RUSSIA Country Report February 2024 www.intellinews.com