Russia Services PMI January 2008

Russian service industries including banking, telecommunications and hospitality expanded at the slowest pace in six years in January as new business growth declined and confidence in the global economy fell. VTB Bank Europe's index of services growth fell to 54.8 in January from 56.6 in December. A figure above 50 indicates expansion so the economy is still expaniding reasonably strongly. What is clear though is that the rate of expansion has slowed. At the present point this is simply one more data reading among others, and it may or may not take on mopre significance as we move forward. In a certain sense, given the inflationary issues which face Russia, this slight reduction in the pace of the expansion might be thought of as welcome news. VTB surveyed 300 purchasing managers at service companies. The index declined for the second month to its ``weakest'' since data were first collected in October 2001.