Finance
Russia's Services Sector Contracts for First Time in Six Months, PMI Shows
Published by Global Banking & Finance Review®
Posted on April 3, 2026
2 min readLast updated: April 3, 2026
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Russia’s services sector slipped into contraction in March, with the S&P Global Services PMI falling to 49.5 from 51.3 in February, as demand weakened and new orders stalled. Employment declined sharply and price pressures eased, while the composite PMI signalled renewed private‑sector contraction.
Russia's Services Sector Sees First PMI Contraction in Six Months in March
March 2024 Russia Services PMI Report Overview
PMI Contraction and Demand Trends
MOSCOW, April 3 (Reuters) - Russia's services sector contracted in March for the first time in six months as demand softened and new orders broadly stalled, a business survey showed on Friday.
The S&P Global Russia Services PMI Business Activity Index fell to 49.5 in March from 51.3 in February, dropping below the 50 mark separating growth from contraction.
New Business and Market Uncertainty
New business was broadly unchanged after four months of expansion, as some firms cited lower client purchasing power, greater uncertainty and lost work linked to the war in the Middle East.
Employment and Staffing Trends
Employment fell for a second straight month and at the quickest pace since January 2023, as companies cut staff amid cost considerations and subdued sales.
Inflation and Price Pressures
Input Cost and Selling Price Inflation
Price pressures eased further from January's VAT-driven highs. Input cost inflation slowed for a second month but remained among the fastest since the start of 2025, while selling price inflation cooled to a three-month low.
Backlogs, Business Confidence, and Composite Output
Work Backlogs and Optimism
Backlogs of work rose for a sixth month, although the pace of accumulation slowed. Firms were more optimistic about output over the next 12 months than in February, but confidence levels remained among the lowest seen in more than three years.
Composite PMI Output Index
The S&P Global Russia Composite PMI Output Index fell to 48.8 in March from 50.8 in February, signalling a renewed decline in private sector activity as manufacturing and services output both contracted.
Reporting and Editorial Credits
(Reporting by Gleb Bryanski; Editing by Hugh Lawson)
Key Takeaways
- •Services PMI dropped below the 50‑point threshold to 49.5 in March, marking the first contraction in six months; new orders stagnated amid weakening client purchasing power and Middle East war‑related disruptions.
- •Employment fell for a second consecutive month at the fastest pace since January 2023; input cost inflation slowed but remained elevated, while selling price inflation cooled to a three‑month low.
- •The composite PMI dipped to 48.8, indicating contraction across both services and manufacturing; business confidence improved slightly from February but remained near three‑year lows.
References
Frequently Asked Questions about Russia's services sector contracts for first time in six months, PMI shows
1Why did Russia's services sector contract in March?
The contraction was due to softened demand, stalled new orders, lower client purchasing power, and rising uncertainty.
2What was the PMI reading for Russia's services sector in March?
The S&P Global Russia Services PMI dropped to 49.5 in March from 51.3 in February.
3How did employment in Russia's services sector change?
Employment fell for the second consecutive month at the fastest pace since January 2023.
4Were there any changes in price pressures for Russian services companies?
Input cost inflation slowed for a second month but remained high, while selling price inflation dropped to a three-month low.
5What are the business expectations for the next 12 months?
Firms were more optimistic than in February, but overall confidence levels remained among the lowest in over three years.