Service industries' index plummets

Moscow: An index of Russian service industries, from banks to mobile phone retailers, plummeted to a record in December to show that the economy, heading for a recession, was curbing spending.

The Purchasing Managers' Index contracted for a third consecutive month to 36.4 from 37.2 in November, VTB Bank Europe said yesterday in an e-mailed statement. A reading of 50 is the dividing line between expansion and contraction.

"Survey respondents pointed to a rapid contraction of incoming new business," the report said.

"Ongoing financial market turmoil and concern over the health of the wider economy" led to a "further substantial decline in client demand," the report added.