Russian Service Sector Contraction Deepens In July

(RTTNews) - The Russian service sector activity deteriorated further in July amid a renewed decline in new orders, survey results from S&P Global showed on Tuesday.

The services purchasing managers' index, or PMI, dropped to 48.6 in July from 49.2 in June. Any reading below 50 indicates contraction in the sector. Further, the rate of decline was the steepest since June 2024.

During July, lower activity was widely linked to a reduction in new order intakes and weak client demand. New orders fell after a 12-month sequence of growth, while employment logged a moderated increase.

On the price front, input price inflation was quicker than in June due to higher costs for utilities, suppliers, and staffing. As a result, the rate of charge inflation also picked up in July.

Looking ahead, firms remained confident about output expectations over the year ahead, linked to hopes of more stable economic and financial conditions, alongside a realignment of company strategies to focus on client outreach.

The composite output index dropped to 47.8 in July from 48.5 in June, signaling a modest contraction in private sector business activity.