Financial News: Russia Factory Downturn Eases In May

Russia Factory Downturn Eases In May

06/01/2026 - 05:06:00 (RTTNews)

(RTTNews) - Russia's factory activity contracted at the weakest pace in three months amid a renewed increase in output levels, survey results from S&P Global showed on Monday.

The manufacturing purchasing managers' index, or PMI, rose to 48.8 in May from 48.1 in April. Nonetheless, any reading below 50 indicates contraction.

The overall downturn was attributed to further declines in new sales due to weak client demand and a drop in purchasing power at customers. New orders fell at the sharpest pace since July 2025. Similarly, new export business contracted at the steepest pace in eight months.

On the other hand, output grew for the first time in fifteen months, though marginally. The level of outstanding business decreased at a substantial pace that was the fastest in over six years.

Russian manufacturers reduced workforce numbers in May, and the decline in employment was solid overall, linked to spare capacity and lower client demand.

On the price front, input price inflation accelerated further, pushed up by higher costs for fuel, metals, and electrical equipment. As a result, selling price inflation quickened to the fastest since February 2025. Higher prices forced firms to increase their purchasing activity in order to build safety stocks.

Looking ahead, goods producers remained less optimistic than in April as concerns regarding customer purchasing power and liquidity weighed on positive sentiment.

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