After several months of slowing growth, Kazakhstan’s services sector contracted in October for the first time in 10 months, according to the latest Freedom Holding and S&P Global PMI survey. 

Demand weakened and firms continued to reduce staff.

The Business Activity Index, which measures monthly changes in output, fell below the neutral 50.0 threshold — posting 49.3 in October, down from 50.8 in September. Any figure below 50 indicates a contraction. 

Sluggish demand meant new orders grew at their slowest pace since March. Weaker client activity prompted companies to scale back hiring, and the rate of job losses accelerated month on month.

While business confidence regarding future output remained positive, sentiment remained historically subdued, only slightly above the recent low observed in September. That reflected concerns about softer demand and broader economic uncertainty, the analysis issued with the PMI data noted.

The data confirmed that since June, when services sector activity expanded strongly, growth momentum has steadily eroded, culminating in October’s downturn — suggesting mounting pressure on Kazakhstan’s broader private-sector recovery.

Surveyed businesses often highlighted declining purchasing power among consumers.

Yerlan Abdikarimov, director of the financial analysis department at Freedom Finance Global, said: "In October, Kazakhstan's services sector entered a transitional phase following the strong performance demonstrated earlier this year. Despite new business inflows remaining in growth territory, the overall business activity index declined below the neutral level and the twelve-month average, though still marginally above last October's reading.

“Margin risks persist under pressure from rising procurement costs and currency fluctuations, compelling companies to adjust service prices. Business expectations for the year ahead remain cautiously positive, reflecting prudence in light of upcoming changes in tax legislation."