The Eurozone grows for the first time since August with the leadership of Spain

The activity of the private sector of the euro zone grew again in January 2025, when The PMI compound index rebounded to 50.2 points Since 49.6 of the previous month, confirming the first expansion since last August. This situation was caused by a sustained reduction (although weaker) of the new orders, which indicated that the recovery was fragile and that it was mainly achieved by the completion of pending orders.

The compound PMI stood above the level of 50, which separates the growth of the contraction. Judging by the sector data, A slower fall in industrial production was fundamental for the expansion in general of Januarysince the activity of the services sector recorded a slightly weaker increase.

The latest national PMI data certified that Spain was again the main growth engine in the euro zonealthough the total activity of this country increased at a weaker pace than in December 2024. However, one of the key reasons for the most generalized recovery was Germany, which registered its best monthly result since May 2024. Even so, With a 50.5 PMI index reading, the January expansion was only marginal. Meanwhile, Italy’s economy was practically stagnant again and France suffered the fifth consecutive contraction of the business activity of the private sector.

The total activity grew in the first month of the year despite having registered the eighth consecutive decline of the new orders received. The ballast for sales came from exports, which fell at a rhythm Stronger than the one observed for the new orders in total, although the new orders decreased only slightly in general and to the weakest rhythm of the current decline sequence. This sustained reduction in the demand for products and services It meant that the growth of the activity was driven by existing orders. The new orders pending realization fell for the twenty -second consecutive month in the first month of 2025, and both manufacturers and service companies completed pending works.

Thanks to the positive, the companies in the euro zone considered the prospects for the next twelve months with a greater degree of optimism, which were already more solid since July 2024. The improvement of trust was accompanied by a level of almost stabilization of employment.

As for prices, January data collected a Intensification in cost pressures in the euro zone. This is because the inflation rate of input prices accelerated until its maximum of twenty -one months and was above the long -term series trend.

Both sectors studied, manufacturing and services, They registered stronger increases in their operational costs in January. Consequently, euro zone companies increased their prices more aggressively charged. Sales prices increased to faster pace in five months.

Services Sector

The PMI of the Servicios Sector registered A new increase when it is 51.3slightly lower than that registered in December, 51.6. The January survey data indicated that the demand conditions for the euro zone services have improved, since the new orders increased for the second consecutive month.

Sales growth was driven by the national marketsince the latest data on the survey revealed that the new orders of foreign clients decreased, although more slowly. The service companies continued to update their orders pending realization, and did so at a rate slightly faster than in December.

For its part, employment increased with respect to the data observed in December 2024, and inflation remained in January. The operational costs of the service companies increased to the most marked rhythm Of the last nine months, although the inflation of sales prices remained stable, matching that observed in December (which was the strongest since May 2024).

The euro zone service companies maintained a Positive attitude With respect to the activity prospects for the next twelve months, although the growth projections were slightly weaker than in December 2024 and stood well below the long -term average.