(Reuters) - Russia's services sector expanded in May at the quickest pace since January, driven by stronger demand and new orders, even as firms reduced their workforce numbers, a business survey
Russia's Services Sector Experiences Fastest Growth Since January
(Reuters) - Russia's services sector expanded in May at the quickest pace since January, driven by stronger demand and new orders, even as firms reduced their workforce numbers, a business survey showed on Wednesday.
The S&P Global Purchasing Managers' Index (PMI) for Russia's services sector rose to 52.2 last month from 50.1 in April, moving further above the 50 mark denoting growth.
New business at service providers increased at the fastest rate in four months, the survey showed. New export business, which had contracted for a year after Moscow invaded Ukraine in February 2022, expanded for the seventh successive month in May, the survey showed.
"The sustained rise in new business from abroad reportedly stemmed from an uptick in customer demand in existing markets," S&P Global said.
However, the outlook for future output dimmed, with confidence dropping to its lowest level since July 2023.
"Firms hope that client demand will improve further and drive new sales, with others also mentioning that output growth could be supported by investment in new products," S&P Global said.
Employment in the services sector saw a renewed decline, with firms cutting headcount at the fastest rate since January 2023.
A sister survey published on Monday showed Russia's manufacturing sector returned to growth in May, supported by a fresh upturn in new orders, even as output contracted for the third month running amid reports of supply shortages.
(Reporting by Alexander Marrow; Editing by Hugh Lawson)
