Russia’s services sector expanded in December at its fastest pace since January, supported by a strong pickup in new orders, according to the latest purchasing managers’ index survey from S&P Global released on Tuesday.
The Russia Services PMI Business Activity Index edged up to 52.3 in December, from 52.2 in November. A reading above 50 signals expansion, while a figure below that threshold indicates contraction.
The modest improvement was driven by firmer customer demand and a notable rise in new business. New orders grew at their quickest pace since May, highlighting renewed momentum across the services sector.
Despite stronger activity, service providers cut staffing levels for the first time in six months. Employment fell at the fastest rate in nearly three years, largely due to a reduction in full-time positions as business confidence weakened.
Capacity pressures also intensified. Backlogs of work increased at the fastest pace in a year, reflecting the stronger inflow of new orders and growing strain on existing resources.
Cost pressures eased significantly, with operating expenses rising at their slowest rate since May 2009. Firms reported higher transportation and supplier costs, but these were partially offset by lower wage expenses. While companies continued to raise selling prices to protect margins, the pace of price increases slowed compared with previous months.
Business sentiment softened further, with optimism slipping to its second-lowest level since January 2023. Even so, firms remained cautiously hopeful that demand conditions would improve and that new service offerings could support future growth.
Meanwhile, the composite PMI, which combines services and manufacturing, held steady at 50.0. Growth in the services sector was offset by a contraction in manufacturing activity, resulting in overall stagnation in private-sector output.
