Page 65 - RusRPTJul23

supplier and wage costs. Despite this, companies made efforts to drive sales, resulting in softer increases in output charges in both the service and manufacturing sectors.
The Services Purchasing Managers' Index (PMI) for Russia experienced a slight decline in May, according to research agency S&P Global. The seasonally adjusted PMI decreased from 55.9 in April to 54.3 in May, remaining above the crucial 50 mark that indicates expansion in the sector.
The decline in the PMI was accompanied by a solid increase in output, driven by new business and strength in foreign markets. Companies reported new client wins and noted positive performance in international markets. Despite a greater number of employees, there was evident pressure on capacity as backlogs of work returned to growth territory, although the rise was only marginal.
The rise in new orders slowed for the second consecutive month, marking the slowest growth in four months. However, export orders demonstrated a solid increase, indicating a positive trend in international demand.
Input prices experienced a steep increase, reflecting higher costs for services, while output price growth was more moderate. This suggests that businesses faced greater cost pressures, which may have affected their pricing strategies.
Looking ahead, the future outlook for the services sector in Russia deteriorated to its worst level in four months. Despite this, companies remained generally optimistic about the future, indicating a belief in the potential for recovery and growth in the sector.
Activity in Russia's manufacturing sector increased for the 13th month running in May and employment rose at its sharpest pace in more than two decades, though export orders contracted, a business survey showed on Thursday.
The S&P Global Purchasing Managers' Index (PMI) for manufacturing rose to 53.5 from 52.6 in April, moving further above the 50 mark that separates expansion from contraction.
"Overall growth was supported by faster expansions in output and new orders, with employment rising at the sharpest pace for 22-1/2 years," S&P Global said in a statement.
Employment was driven by stronger client demand, a trend that also helped decrease work backlogs.
"The rate of job creation was the steepest since November 2000 as firms adjusted their workforce numbers upward amid greater production
65 RUSSIA Country Report July 2023 www.intellinews.com