Eurozone services sector sees modest improvement - PMI
By Abigail Townsend
Date: Thursday 03 Apr 2025
(Sharecast News) - The Eurozone economy expanded modestly in March, a closely-watched survey showed on Thursday, boosted by an uptick in the services sector.
The latest HCOB Eurozone services business activity index came in at 51.0, up from February's 50.6 and a two-month high.
A reading above the neutral 50.0 benchmark indicates growth, while one below it suggests contraction.
Business volumes were down marginally, with exports in particular weak. But activity levels rose at a quicker pace than in February, with backlogs cleared at a faster rate.
As a result, the HCOB Eurozone composite PMI output index nudged up to 50.9 from 50.2 in February, its highest reading since August. The index is a weighted average of the manufacturing and services indices.
Among individual countries Germany - the bloc's biggest economy - hit a 10-month higher of 51.3, comfortably ahead of earlier estimates for 50.9.
Spain and Italy also continued to expand, with prints of 54.0 and 50.5 respectively.
But France remained in contraction, at 48.0, although it was an improvement on the first estimate for 47.0.
Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, said: "You can't really call it growth anymore in the Eurozone's service sector. Once again, the index is hovering only slightly above 50.0. New business has even seen a small drop for the second month running.
"That said, rising real wages could help stimulate private consumption, which would especially benefit service providers.
"At the end of last year, it looked like the Eurozone was heading into a recession, but things have somewhat stabilise at the start of this year.
"However, US tariffs could quickly throw the economy off course against. That's why the fiscal packaged planned in Germany, which is mainly aimed at supporting the defence and construction industries but could also indirectly benefit the service sector, is a welcome counterweight."
Data were collected between 12 and 26 March. Surveys are sent to panels of around 5,000 private sector manufacturing and services companies across the Eurozone.
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