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. Last Updated: 07/27/2016

Services Industries Still Contracting

An index of Russian service industries ranging from banks to restaurants remained negative for a sixth month in March as companies cut jobs at the fastest rate in the survey's history.

The Purchasing Managers' Index was at 43.9 last month, compared with 40 in February, VTB Capital said Friday in a statement. A reading above 50 indicates expansion, below 50 a contraction. The VTB survey of 300 purchasing managers at service companies began in October 2001.

"The results signal a further general decline in the Russian services sector," VTB Capital analyst Svetlana Aslanova wrote. "Surging price competition on the back of weak market demand has prompted companies to tighten their cost-cutting programs."

Job cuts were most severe in the hotel and restaurant industries, while business activity fell at the fastest rates in the transport, storage, post and telecommunications sectors.