Russian manufacturing continues to slump in September - HSBC
MOSCOW. Oct 1 (Interfax) - Russia's manufacturing sectors continued to slump last month, according to HSBC research, making last quarter the weakest since Q4 of 2009.
"September PMI [Purchasing Managers Index] data from HSBC showed an ongoing deterioration in Russian manufacturing business conditions, rounding off the weakest quarter since Q4 2009. New order growth slowed to a marginal rate as new export work declined for the first time in five months. Output rose at a fractional pace, and the rate of job shedding remained among the sharpest seen in four years. Input and output prices both continued to rise at historically weak rates," the bank said.
"The PMI registered in negative territory for the third month in succession in September, the longest run of sub-50.0 readings since late-2009. The headline index was unchanged from August at 49.4 and signaled a marginal overall deterioration in operating conditions," HSBC said.
PMI readings above 50.0 points indicate growth in business activity, below 50.0 points a decline.
The PMI, "a composite indicator designed to give a single-figure snapshot of operating conditions in the manufacturing economy - registered in negative territory for the third month in succession in September, the longest run of sub-50.0 readings since late-2009. The headline index was unchanged from August at 49.4 and signaled a marginal overall deterioration in operating conditions. The average reading for Q3 (49.3) was the lowest since Q4 2009 (49.2)," the company said.
"A marginal rise in new orders received by Russian goods producers signaled ongoing tough demand conditions in the sector. In particular, the volume of new export work declined for the first time in five months, and at the fastest rate since December 2012. With new orders registering fractional growth in September, the volume of output rose only marginally. The overall trend over the third quarter was one of stagnation, with production levels supported by working through existing contracts. Backlogs of work declined for the seventh month running, and at the fastest pace since September 2012," HSBC said.
"In line with the trend shown for new business, the volume of inputs purchased by Russian manufacturers was only marginally higher than one month previously. Input inventories continued to decline sharply as a result. Suppliers' delivery times lengthened slightly, having improved in August.
Headcounts at manufacturers remained under pressure in September, with employment in the sector declining at a rate little-changed from August's four-year record. The workforce has contracted ten times in the past 11 months.
"Inflationary pressures remained subdued in September, despite the weak ruble continuing to place pressure on import prices. Input price inflation was unchanged at a historically weak level, while output prices rose only modestly," the bank said.