The final data published by HCOB showed that private sector activity continued to expand in March, while the pace of expansion accelerated to a 7-month high. Greater output volumes came despite a further contraction in new work intakes, although employment rose for the first time since last July.
The eurozone composite PMI output index, which assesses the change in activity in the manufacturing sector and the service sector, rose to 50.9 points in March from 50.2 points in February. Economists had expected an increase to 50.4 points. An index value above 50 points indicates an expansion of activity in the sector. As for the eurozone countries, most of them have recorded higher business activity. France was an outlier, posting a seventh successive monthly contraction (albeit one that was slower than previously). Meanwhile, Ireland’s economy saw the quickest upturn, with growth here improving to a four-month high, topping Spain by a small margin. More modest expansions were seen in Germany and Italy.
Meanwhile, the eurozone services PMI reached 51.0 compared to 50.6 in February and forecasts at 50.4.
The data also showed that new orders in the private sector fell again in March, with the contract cooling to a marginal pace that was the weakest since June 2024. This was despite new export orders presenting a slightly stronger drag, as they fell at a slightly faster rate than in February. Workforce numbers across the eurozone grew for the first time since July 2024. The overall rate of employment growth was the fastest for nine months, but only marginal overall. The backlogged orders fell for a 24th month in a row, with the pace of decline being the fastest for three months. Meanwhile, the eurozone companies were optimistic towards the 12-month outlook overall, but the level of positive sentiment dipped slightly to a three-month low and remained weaker than the long-run average.
As for the inflationary situation, the operating costs rose, predominantly due to higher expenses for services companies, although the overall rate of increase across the private sector was the softest for three months. Prices charged for eurozone goods and services were lifted, but also to the least marked extent in the year-to-date.