Russia’s services sector showed signs of stabilisation in August after two straight months of contraction, according to S&P Global. Employment grew at the fastest pace since February, giving businesses a boost of confidence.
The S&P Global Russia Services PMI Business Activity Index rose to 50.0 in August from 48.6 in July. A score of 50.0 signals no change in activity, while figures above it indicate growth.
Although new orders continued to decline, the drop was less severe than in July. Companies pointed to tough financial conditions and customer caution as the main reasons. However, the slower fall in demand allowed output levels to stabilise.
Despite weak demand, service providers increased their workforce. The rise in employment, the quickest since February, helped businesses manage backlogs and prepare for expected sales growth.
Cost pressures also eased. Input prices grew at the slowest pace in more than five years, supported by favourable exchange rate trends. Still, firms raised their output charges, passing some costs on to customers.
Business confidence stayed positive but slipped to its second-lowest level since July 2023. Many companies pinned their hopes on stronger demand and future market expansion.
In contrast, Russia’s manufacturing sector weakened further in August. A separate survey showed activity shrinking for the third month in a row, with declines in both output and new orders.
