Russia Services Sector Contracts Again as Confidence Hits 40-Month Low

Russia’s services sector contracted for a second straight month in April as weak demand weighed on output and new orders, while business confidence fell to a 40-month low, Gleb Bryanski reported for Reuters.

New business declined after five months of expansion, with the drop the sharpest since September 2025.

The S&P Global Russia Services PMI Business Activity Index edged up to 49.7 in April from 49.5 in March, remaining below the 50 mark that separates growth from contraction.

New business declined after five months of expansion, with the drop the sharpest since September 2025. Export orders also fell at the fastest pace in 18 months.

Firms reduced staffing for a third consecutive month as workloads eased. While the pace of job cuts slowed, it remained among the fastest since January 2023.

Backlogs of work declined for the first time since September 2025 as companies processed orders more quickly due to sufficient capacity.

Inflationary pressures also eased, with both input costs and output prices cooling from January’s VAT-driven surge. Despite the downturn, firms still expect activity to improve over the next year, although optimism is tempered by clients’ financial constraints.