Latest news with #delaRubia
Gulf Today
2 days ago
- Business
- Gulf Today
Eurozone business growth stalls in May as services stumble: PMI
Eurozone business activity barely expanded in May as the dominant services industry contracted for the first time since November, weighed down by falling demand that has plagued the bloc for a year, a survey showed on Wednesday. The HCOB Eurozone Composite Purchasing Managers' Index, compiled by S&P Global, fell to 50.2 in May from 50.4 in April, higher than a preliminary estimate of 49.5 but its weakest since February. PMI readings above 50.0 indicate growth in activity, while those below point to a contraction. 'The euro zone economy has grown for the fifth month in a row,' said Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, adding that the data required some goodwill as it was only marginally above the expansion threshold. 'This development is due to a slight decline in activity in the service sector, while manufacturing output showed the same moderate growth as in the previous month.' The services sector saw its business activity index drop to 49.7 from 50.1 in April, signalling a marginal contraction and its first time sub-50 in six months. Overall new business across the euro zone has declined since June 2024, albeit at a modest rate, and the new business index dipped last month to 49.0 from 49.1. Foreign orders have fallen for more than three years, offering no support to the struggling economy. Firms continued to work through their backlogs of orders at a moderate and slightly faster rate to compensate for the lack of new work. The services reading fell to 47.4 from 48.1. Among the bloc's largest economies, only the southern nations showed expansion. Italy led the way with its fastest growth in more than a year, while Spain's growth slowed to a 17-month low. France moved closer to stabilisation with its softest decline in nine months, while Germany slipped back into contraction territory. Employment across the euro zone increased only fractionally in May, driven by service providers, while manufacturers cut jobs. Price pressures eased across the bloc, with composite input costs rising at their slowest pace in six months and selling prices increasing at the weakest rate since October. However, the picture was mixed between sectors. 'The European Central Bank will not be entirely satisfied with the PMI price data. In the services sector, which is closely watched for inflation, the rate of increase in sales prices fell again,' de la Rubia added. Business confidence improved for the first time since January but remained subdued by historical standards, suggesting companies remain cautious about future prospects despite expectations of ECB rate cuts and potential fiscal stimulus. The ECB will almost certainly cut interest rates on Thursday, a Reuters poll found. There was no majority among the economists surveyed by Reuters on where the deposit rate will end the year. Separately, Germany's services sector recorded its sharpest contraction in activity in 2-1/2 years in May as weaker demand and heightened uncertainty took their toll, a survey showed on Wednesday. The final HCOB Purchasing Managers' Index (PMI) for the services sector fell to 47.1 in May, down from 49.0 in April, marking its lowest level since November 2022. PMI readings below 50.0 indicate a contraction in activity, while those above point to growth. The survey found accelerated declines in both activity and new business, while the pace of job creation slowed. 'The service sector is no longer stabilizing the overall economy, it is slowing it down,' said Hamburg Commercial Bank chief economist Cyrus de la Rubia. Services firms in Europe's biggest economy, which is battling to avoid a historic third year of contraction in 2025, registered a reduction in inflows of new work in May for the ninth month in a row. Despite a recovery in business expectations from April's recent low, confidence remained subdued by historical standards. Nevertheless, de la Rubia said conditions for a recovery were 'relatively good'. The HCOB's broader composite PMI index, which includes both manufacturing and services, slipped into contraction in May, falling to 48.5 from 50.1 in April, reflecting slower growth in manufacturing production and the accelerated decline in services activity. Meanwhile, european shares rose on Wednesday with Germany's benchmark index nearing a record high ahead of a first tax relief package aimed at kick-starting growth in the region's largest economy. The German cabinet wants to approve the package on Wednesday, a spokesperson from the finance ministry said earlier this week to support companies. That would come ahead of latest survey showing euro zone business activity barely expanded in May and Germany's services sector recorded its sharpest contraction in activity in more than two years, weighed down by falling demand that has plagued the bloc for a year. Agencies
RTÉ News
2 days ago
- Business
- RTÉ News
Euro zone business activity bearly expanded in May
Euro zone business activity barely expanded in May as the dominant services industry contracted for the first time since November, weighed down by falling demand that has plagued the bloc for a year, a survey has shown. The HCOB Eurozone Composite Purchasing Managers' Index, compiled by S&P Global, fell to 50.2 in May from 50.4 in April, higher than a preliminary estimate of 49.5 but its weakest since February. PMI readings above 50.0 indicate growth in activity, while those below point to a contraction. "The euro zone economy has grown for the fifth month in a row," said Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, adding that the data required some goodwill as it was only marginally above the expansion threshold. "This development is due to a slight decline in activity in the service sector, while manufacturing output showed the same moderate growth as in the previous month." The services sector saw its business activity index drop to 49.7 from 50.1 in April, signalling a marginal contraction and its first time sub-50 in six months. Overall new business across the euro zone has declined since June 2024, albeit at a modest rate, and the new business index dipped last month to 49.0 from 49.1. Foreign orders have fallen for more than three years, offering no support to the struggling economy. Firms continued to work through their backlogs of orders at a moderate and slightly faster rate to compensate for the lack of new work. The services reading fell to 47.4 from 48.1. Among the bloc's largest economies, only the southern nations showed expansion. Italy led the way with its fastest growth in more than a year, while Spain's growth slowed to a 17-month low. France moved closer to stabilisation with its softest decline in nine months, while Germany slipped back into contraction territory. Employment across the euro zone increased only fractionally in May, driven by service providers, while manufacturers cut jobs. Price pressures eased across the bloc, with composite input costs rising at their slowest pace in six months and selling prices increasing at the weakest rate since October. However, the picture was mixed between sectors. "The European Central Bank will not be entirely satisfied with the PMI price data. In the services sector, which is closely watched for inflation, the rate of increase in sales prices fell again," de la Rubia added. Business confidence improved for the first time since January but remained subdued by historical standards, suggesting companies remain cautious about future prospects despite expectations of ECB rate cuts and potential fiscal stimulus. The ECB will almost certainly cut interest rates on Thursday, a Reuters poll found. There was no majority among the economists surveyed by Reuters on where the deposit rate will end the year.
Yahoo
4 days ago
- Business
- Yahoo
Eurozone manufacturing shows signs of recovery: Is the slump over?
The HCOB Eurozone Manufacturing PMI for May 2025 was 49.4, up from 49.0 in April, according to S&P Global. However, this is still in contraction territory, as it was below 50, and marked the slowest pace of contraction in the manufacturing sector since August 2022. Meanwhile, output rose for the third month in a row, with new orders stabilising after almost three years of decline. The rate of backlog depletion also dropped to the slowest pace since June 2022. On the other hand, employment levels continued to lag, although they decreased at the slowest rate since September 2023. Input costs fell for the second consecutive month, which was the fastest decline in 14 months, while output prices slid for the first time since February this year. Business confidence rose to the highest level in more than three years in May. Dr. Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, said in the May Eurozone PMI report: 'The upward trend in the headline PMI is still continuing, pointing towards a recovery that is progressing. That is backed up by the rise in production we have seen since March. 'What is especially encouraging is that production has picked up across all four major eurozone economies, which really highlights how broad-based this recovery is. With output rising for three months in a row, historical patterns suggest there is a 72% chance we will see another increase in the next month.' However, he highlighted that the possibility of the US imposing steeper tariffs against the EU is a major risk to this outlook. 'Still, companies are noticeably more upbeat than they were last month about producing more a year from now, which shows a certain resilience, even in the face of potential protectionist moves from across the Atlantic,' de la Rubia added. Falling oil and gas prices and lower interest rates supported the eurozone manufacturing sector in May, with production rising in France, Germany, Spain and Italy. Related What's the average UK house price? May's market data shows resilience US economy falls 0.2% in the first quarter, hit by Trump's trade war The HCOB Spain manufacturing PMI for May was 50.5, a jump from April's 48.1, according to S&P Global. This was ahead of analyst expectations of 48.4. After three straight months of contraction, this was the first expansion in the Spanish manufacturing sector, while also being the highest number since January. May's higher figure could be because of underlying demand improving slightly. While uncertainties affected the sector significantly in April, the market seemed to readjust a little in May. Spanish manufacturing sales volumes fell in May, however, the decline was the smallest in four months. Companies continued to hire for the third consecutive month, while input costs fell for the first time since the beginning of last year. Output prices also dropped at the fastest rate since September 2024, mainly due to higher market competition. Similarly, output sentiment for the next 12 months rose to a three-month high. Jonas Feldhusen, junior economist at Hamburg Commercial Bank, said in the May Spain PMI report: 'Spain's manufacturing sector sent encouraging signals in May. Whether this improvement is partly attributable to early signs of easing in the global tariff conflict remains uncertain. 'While Spain's direct dependence on the U.S. market is relatively limited compared to countries like Germany or Italy, indirect effects from a generally improved global trade outlook may also be contributing.' Related European markets lower as investors eye US-China trade developments The HCOB Germany manufacturing PMI for May came down to 48.3, down from April's 48.4, according to S&P Global. This was the 35th month in a row of contraction in the German manufacturing sector, although output advanced for the third month in a row. Manufacturing output was mainly supported by rising export orders from the US and Europe, although overall new orders still fell marginally, dampened by lagging domestic demand. Job cuts slowed to the weakest pace since January 2024, with input stock declines and purchasing activity decreases also slowing. Input prices continued to fall, dragged down by lower oil prices, lagging demand and a stronger euro. Robust competition led to more factory gate price cuts in May, while optimism about future output soared to the highest level since early 2022. Dr. Cyrus de la Rubia noted in the May Germany PMI report: 'Most people have got so used to gloomy headlines from the industrial sector that the good news often slips under the radar. That is why it is worth looking beyond the headline PMI figure, which dipped slightly and is still in contraction territory. The broader picture actually shows some encouraging signs. 'Production has now increased for the third month in a row, and foreign orders have been on the rise for two straight months. What's more, the uptick in output is not limited to just one area – it is showing up across the board, in capital goods, intermediate goods and consumer goods.' He further noted that business sentiment may be optimistic due to the formation of a new government, along with a large infrastructure package, the promise of tax breaks and plans to increase defence spending. 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Yahoo
4 days ago
- Business
- Yahoo
Eurozone manufacturing shows signs of recovery: Is the slump over?
The HCOB Eurozone Manufacturing PMI for May 2025 was 49.4, up from 49.0 in April, according to S&P Global. However, this is still in contraction territory, as it was below 50, and marked the slowest pace of contraction in the manufacturing sector since August 2022. Meanwhile, output rose for the third month in a row, with new orders stabilising after almost three years of decline. The rate of backlog depletion also dropped to the slowest pace since June 2022. On the other hand, employment levels continued to lag, although they decreased at the slowest rate since September 2023. Input costs fell for the second consecutive month, which was the fastest decline in 14 months, while output prices slid for the first time since February this year. Business confidence rose to the highest level in more than three years in May. Dr. Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, said in the May Eurozone PMI report: 'The upward trend in the headline PMI is still continuing, pointing towards a recovery that is progressing. That is backed up by the rise in production we have seen since March. 'What is especially encouraging is that production has picked up across all four major eurozone economies, which really highlights how broad-based this recovery is. With output rising for three months in a row, historical patterns suggest there is a 72% chance we will see another increase in the next month.' However, he highlighted that the possibility of the US imposing steeper tariffs against the EU is a major risk to this outlook. 'Still, companies are noticeably more upbeat than they were last month about producing more a year from now, which shows a certain resilience, even in the face of potential protectionist moves from across the Atlantic,' de la Rubia added. Falling oil and gas prices and lower interest rates supported the eurozone manufacturing sector in May, with production rising in France, Germany, Spain and Italy. Related What's the average UK house price? May's market data shows resilience US economy falls 0.2% in the first quarter, hit by Trump's trade war The HCOB Spain manufacturing PMI for May was 50.5, a jump from April's 48.1, according to S&P Global. This was ahead of analyst expectations of 48.4. After three straight months of contraction, this was the first expansion in the Spanish manufacturing sector, while also being the highest number since January. May's higher figure could be because of underlying demand improving slightly. While uncertainties affected the sector significantly in April, the market seemed to readjust a little in May. Spanish manufacturing sales volumes fell in May, however, the decline was the smallest in four months. Companies continued to hire for the third consecutive month, while input costs fell for the first time since the beginning of last year. Output prices also dropped at the fastest rate since September 2024, mainly due to higher market competition. Similarly, output sentiment for the next 12 months rose to a three-month high. Jonas Feldhusen, junior economist at Hamburg Commercial Bank, said in the May Spain PMI report: 'Spain's manufacturing sector sent encouraging signals in May. Whether this improvement is partly attributable to early signs of easing in the global tariff conflict remains uncertain. 'While Spain's direct dependence on the U.S. market is relatively limited compared to countries like Germany or Italy, indirect effects from a generally improved global trade outlook may also be contributing.' Related European markets lower as investors eye US-China trade developments The HCOB Germany manufacturing PMI for May came down to 48.3, down from April's 48.4, according to S&P Global. This was the 35th month in a row of contraction in the German manufacturing sector, although output advanced for the third month in a row. Manufacturing output was mainly supported by rising export orders from the US and Europe, although overall new orders still fell marginally, dampened by lagging domestic demand. Job cuts slowed to the weakest pace since January 2024, with input stock declines and purchasing activity decreases also slowing. Input prices continued to fall, dragged down by lower oil prices, lagging demand and a stronger euro. Robust competition led to more factory gate price cuts in May, while optimism about future output soared to the highest level since early 2022. Dr. Cyrus de la Rubia noted in the May Germany PMI report: 'Most people have got so used to gloomy headlines from the industrial sector that the good news often slips under the radar. That is why it is worth looking beyond the headline PMI figure, which dipped slightly and is still in contraction territory. The broader picture actually shows some encouraging signs. 'Production has now increased for the third month in a row, and foreign orders have been on the rise for two straight months. What's more, the uptick in output is not limited to just one area – it is showing up across the board, in capital goods, intermediate goods and consumer goods.' He further noted that business sentiment may be optimistic due to the formation of a new government, along with a large infrastructure package, the promise of tax breaks and plans to increase defence spending. 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Euronews
4 days ago
- Business
- Euronews
Eurozone manufacturing shows signs of recovery: Is the slump over?
The HCOB Eurozone Manufacturing PMI for May 2025 was 49.4, up from 49.0 in April, according to S&P Global. However, this is still in contraction territory, as it was below 50, and marked the slowest pace of contraction in the manufacturing sector since August 2022. Meanwhile, output rose for the third month in a row, with new orders stabilising after almost three years of decline. The rate of backlog depletion also dropped to the slowest pace since June 2022. On the other hand, employment levels continued to lag, although they decreased at the slowest rate since September 2023. Input costs fell for the second consecutive month, which was the fastest decline in 14 months, while output prices slid for the first time since February this year. Business confidence rose to the highest level in more than three years in May. Dr. Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, said in the May Eurozone PMI report: 'The upward trend in the headline PMI is still continuing, pointing towards a recovery that is progressing. That is backed up by the rise in production we have seen since March. 'What is especially encouraging is that production has picked up across all four major eurozone economies, which really highlights how broad-based this recovery is. With output rising for three months in a row, historical patterns suggest there is a 72% chance we will see another increase in the next month.' However, he highlighted that the possibility of the US imposing steeper tariffs against the EU is a major risk to this outlook. 'Still, companies are noticeably more upbeat than they were last month about producing more a year from now, which shows a certain resilience, even in the face of potential protectionist moves from across the Atlantic,' de la Rubia added. Falling oil and gas prices and lower interest rates supported the eurozone manufacturing sector in May, with production rising in France, Germany, Spain and Italy. The HCOB Spain manufacturing PMI for May was 50.5, a jump from April's 48.1, according to S&P Global. This was ahead of analyst expectations of 48.4. After three straight months of contraction, this was the first expansion in the Spanish manufacturing sector, while also being the highest number since January. May's higher figure could be because of underlying demand improving slightly. While uncertainties affected the sector significantly in April, the market seemed to readjust a little in May. Spanish manufacturing sales volumes fell in May, however, the decline was the smallest in four months. Companies continued to hire for the third consecutive month, while input costs fell for the first time since the beginning of last year. Output prices also dropped at the fastest rate since September 2024, mainly due to higher market competition. Similarly, output sentiment for the next 12 months rose to a three-month high. Jonas Feldhusen, junior economist at Hamburg Commercial Bank, said in the May Spain PMI report: 'Spain's manufacturing sector sent encouraging signals in May. Whether this improvement is partly attributable to early signs of easing in the global tariff conflict remains uncertain. 'While Spain's direct dependence on the U.S. market is relatively limited compared to countries like Germany or Italy, indirect effects from a generally improved global trade outlook may also be contributing.' The HCOB Germany manufacturing PMI for May came down to 48.3, down from April's 48.4, according to S&P Global. This was the 35th month in a row of contraction in the German manufacturing sector, although output advanced for the third month in a row. Manufacturing output was mainly supported by rising export orders from the US and Europe, although overall new orders still fell marginally, dampened by lagging domestic demand. Job cuts slowed to the weakest pace since January 2024, with input stock declines and purchasing activity decreases also slowing. Input prices continued to fall, dragged down by lower oil prices, lagging demand and a stronger euro. Robust competition led to more factory gate price cuts in May, while optimism about future output soared to the highest level since early 2022. Dr. Cyrus de la Rubia noted in the May Germany PMI report: 'Most people have got so used to gloomy headlines from the industrial sector that the good news often slips under the radar. That is why it is worth looking beyond the headline PMI figure, which dipped slightly and is still in contraction territory. The broader picture actually shows some encouraging signs. 'Production has now increased for the third month in a row, and foreign orders have been on the rise for two straight months. What's more, the uptick in output is not limited to just one area – it is showing up across the board, in capital goods, intermediate goods and consumer goods.' He further noted that business sentiment may be optimistic due to the formation of a new government, along with a large infrastructure package, the promise of tax breaks and plans to increase defence spending.
