In September, Russian business activity sharply declined. The PMI index, which reflects the state of industry and services, fell to 46.6 points — the lowest since October 2022. This was reported by the Center for Countering Disinformation (CCD), according to UNN.
Details
The Center for Countering Disinformation noted that this signifies an actual decline in economic activity: in industry, it has been ongoing for the fourth consecutive month, and in the services sector, the worst result since December 2022 was recorded.
Due to rising credit costs, increased taxes, and Western sanctions against Russia, companies are facing a sharp increase in expenses. At the same time, it is becoming increasingly difficult to pass these costs on to the end consumer: prices are rising slower than production costs. This is another consequence of the Kremlin's reliance on a war economy.
According to the CCD, in the context of the full-scale war against Ukraine, Russia is reallocating resources in favor of the defense industry, while "peaceful" businesses are stagnating.
"Despite optimistic government forecasts, real indicators show that the Russian economy is in a deep stagnation," the CCD added.
Recall
The Russian government expects a budget deficit of $68 billion by the end of 2025, almost double previous forecasts. This is due to reduced oil and gas revenues and high war expenditures.