The rate of business growth in the eurozone rose at its fastest pace for three months in February, according to the latest HCOB Flash Eurozone PMI released by S&P Global.
According to the provisional data, the rate of expansion was most significant in the manufacturing sector, where output increased at the sharpest rate since August 2025. The Manufacturing PMI Output Index stood at 52.1 for the month, a six-month high, while the overall Manufacturing PMI stood at 50.8, a 44-month high.
Elsewhere, the Services PMI Business Activity Index stood at 51.8 in February, up from 51.6 in January.
As S&P Global noted, the increase in overall new orders remained muted for the month, with no change since January, while firms showed reluctance to hiring additional personnel.
Elsewhere, the rate of input cost inflation accelerated for the fourth month in a row, however output charges were raised at a slightly softer pace than in the previous month.
Business confidence
Business confidence eased marginally across the eurozone in February, compared to the previous month, however business optimism was still at its second-highest level for 21 months.
Sentiment in the manufacturing sector reached a four-year high, and service providers, while slightly less optimistic than in January, were also confident of an increase in business activity over the coming year.
‘Turning point’
“It might be premature, but this could be the turning point for the manufacturing sector as the headline PMI increased to growth territory,” commented Dr. Cyrus de la Rubia, chief economist at Hamburg Commercial Bank. “Since June 2022 this happened only once, in August of last year. This time, the overall basis for further growth seems to be a bit better.
“Most PMI subindices are on a higher level than in August, like, for example, the volume of purchases, the view on future output and the inventory indicators. New orders are growing at a moderate rate after three months of contraction. This indicator has to show better results in the coming months to make us feel more comfortable about the prospects of this sector over the next quarters. Overall, it seems that the manufacturing sector is on a more stable footing and could contribute to overall growth this year instead of being a drag for the economy.” Read more here.
