MOSCOW: Russian manufacturing activity returned to contraction in July due to deteriorating demand, the Markit purchasing managers' index (PMI) showed on Monday.
The index's headline reading fell to 49.5 from 51.5 in June, slipping back below the 50.0 mark that separates expansions in activity from contractions.
The downturn in the sector reflected weak underlying demand for Russian goods as both new export orders and new work levels slipped into contraction territory, the survey showed.
Falling new business from abroad reflected difficulties with shipping Russian goods overseas, the poll showed.
The lower workforce numbers in Russia's goods producing sector in July ended a two-month sequence of job growth.
"However, backlogs of work accumulating for the first time since January 2013 suggests capacity pressures are finally building," said Samuel Agass, an economist at Markit.
"But with input stocks declining and buying activity falling, firms appear to be taking a cautious approach at present."
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