Russia Service Sector Shrinks At Softer Pace

Russia's service sector logged back-to-back contractions in November, but the rates of declines in output and new orders softened, survey results from S&P Global showed on Monday.

The services Purchasing Managers' Index rose notably to 48.3 in November from 43.7 in the previous month.

Although the reading advanced from October, the score remained below the threshold 50.0 mark suggesting contraction. The survey participants attributed the fall in activity to weak client demand.

The decrease in new orders slowed from October as the acquisition of new customers led to a less severe fall. Nonetheless, foreign orders fell sharply amid subdued global demand and logistics issues.

Input prices increased again in November amid hikes in supplier and logistics costs. Despite a substantial rise in cost burdens, the uptick in output charges was the slowest since February 2021.

Although new business contracted for the second straight month, service providers reported renewed optimism regarding the outlook for output. The degree of positive sentiment was historically subdued.

Companies reduced their hiring activity due to reduced business requirements. The fall in workforce numbers was strong.

The composite output index posted 50.0 in November, up from 45.8 in October, to signal no change in private sector business activity. A further contraction in service sector output counteracted a solid rise in manufacturing production.

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