Russia Services Sector Returns to Growth

The S&P Global Russia Services PMI increased to 51.3 in August 2026 from 49.0 in July, marking the first expansion in the sector since February. The growth was supported by rising business activity amid renewed growth in new sales and reports of stronger customer demand. Employment declined for the seventh consecutive month as firms reduced staffing levels amid subdued demand conditions, although the pace of job shedding was the weakest in three months. Meanwhile, backlogs of work continued to contract amid muted new order inflows. On the price front, input costs rose due to higher energy and transportation costs. However, inflation eased to its joint-weakest level in 2026 so far and remained below the series average. Meanwhile, selling prices rose faster as firms sought to pass on higher costs to customers and protect margins. Looking ahead, business confidence improved to a five-month high on hopes of stronger demand and investment.

The S&P Global Russia Services PMI rose to 49.0 in July 2026 from 48.2 in June, but remained below the 50.0 threshold, signaling a fourth consecutive month of contraction. The latest reading marked the softest contraction in three months, as the decline in business activity eased amid a slower fall in new business inflows. Demand conditions remained weak, with firms citing subdued demand and lower customer purchasing power weighing on sales. New orders fell for the fourth straight month, although the pace of decline eased to the weakest since April. Employment declined for the sixth consecutive month as firms reduced staffing levels, though the pace of job shedding softened from June. On the price front, input cost inflation accelerated due to fuel shortages and higher transportation costs, prompting firms to raise output charges faster. Lastly, business confidence improved to a three-month high on hopes of stronger demand and investment, but remained below its long-run average.

The S&P Global Russia Services PMI declined to 48.2 in June 2026 from May's 48.7, marking the fourth consecutive month of contraction in the sector. The latest reading also marked the steepest contraction since last September, driven by sharper declines in both output and new orders. In line with lower new orders, firms reduced employment for the fifth consecutive month, with the pace of job shedding the steepest in three and a half years. On the price front, input costs rose due to higher transportation fees and wage bills. However, input price inflation eased for the fifth consecutive month, down from January's VAT-driven peak. Meanwhile, output charges also increased as firms passed higher costs on to customers, although output price inflation slowed to its lowest level since January 2021. Looking ahead, business sentiment remained weak, reaching its second-lowest level since December 2022.