Russian service sector activity in July rises at fastest pace in 41 months

Russia’s headline seasonally adjusted Markit Services Business Activity Index rose to 55 in July, a 41-month high. It is up from June’s 53.8. The July’s figure indicates towards the most solid upturn in the nation’s service sector since February 2013 and continues the trend of growth that was first seen six months ago.

Composite data showed an additional strong growth of Russia’s private sector in July, the sixth reported in as many months. The seasonally adjusted Composite Output Index posted at 53.5, unchanged since June, stated Markit.

Service providers of Russia continued to register an increased level of new business in July. Even if the growth rate was the sharpest in 42 months, the recent increase was just a tad stronger than the long-run average. In the meantime, new orders levels at goods producers came back in the contraction territory after expanding in June.

The deteriorating backlogs trend ended in July after service providers registered broadly unchanged levels of outstanding work. This trend was reflected at manufacturers after reporting the first accumulation in outstanding business for 41 month, noted Markit.  July’s survey data showed a rise in the number of workforce in the nation’s service sector.

Furthermore, the increase in staffing levels was the first recorded in 29 months. However, the pace of job creation was marginal. Meanwhile, job cutting was clearly seen in the manufacturing sector. Employment in private sector dropped for the thirty-seventh consecutive month. Services firms in Russia continued to be upbeat towards future business activity growth in July. Also, the level of optimism sentiment rose to a 29-month high, stated Markit.