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Russia's service sector registered considerable contraction in May, due to the control measures taken to reduce the spread of coronavirus, survey data from IHS Markit showed on Wednesday.

The services Purchasing Managers' Index rose to 35.9 in May from 12.2 in April. Any reading below 50 indicates contraction in the sector. This was the second-fastest decline since early-2009.

Output decreased due to weaker client demand in May. Export demand declined at the second-steepest pace on record, amid the ongoing lockdowns and travel restrictions.

Firms reduced their staffing levels in May and backlogs of work fell considerably as new business inflows declined further.

Negative sentiment eased in May and companies foresee a decline in the business activity in the next 12 months.

On the price front, firms reduced their output charges for the second straight month. The rate of cost inflation was below the long-run series average.

The composite output index increased to 35.0 in May from 13.9 in April. The score suggested contraction in the manufacturing and services sectors.

"Business activity at Russian service providers continued to be stymied by emergency public health measures in response to the COVID-19 pandemic," Si?n Jones, an economist at IHS Markit, said.



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