Weaker services weigh on Eurozone growth - PMI
By Abigail Townsend
Date: Wednesday 03 Sep 2025
(Sharecast News) - The Eurozone economy expanded in August, a closely-watched survey showed on Wednesday, but at a sluggish pace that narrowly missed expectations.
The seasonally-adjusted HCOB Eurozone composite PMI output index was 51.0 last month, a 12-month high.
A reading above the neutral 50 benchmark indicates growth, while one below it suggests contraction.
However, August's print was up only marginally on July's 50.9, and narrowly missed expectations for 51.1.
Within that, the services PMI business activity index eased to 50.5 from 51.0 in July, with demand "virtually flat", the survey noted.
The sector's weaker performance offset a stronger showing in manufacturing, where the PMI output index jumped to 52.5 from 50.6. The composite PMI is a weighted average of both indices.
Among individual countries, the composite PMI output index for Germany - the European Union's largest economy - was 50.5, marginally below the flash reading of 50.9 and a two-month low.
Spain was the fastest growing economy, at 53.7, and France the slowest, at 49.8, although that was a 12-month high.
Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, said: "Riding a bike too slowly can make you tip over. That's the risk facing the Eurozone. Yes, the economy has been growing since the start of the year, but the pace is painfully slow.
"Political tensions in France and Spain, uncertainty around the EU-US trade deal and ongoing troubles in the key automotive sector aren't helping.
"Right now, the services sector fells more like stagflation that recovery."
The European Central Bank meets next week to discuss interest rates and is generally expected to leave the cost of borrowing on hold.
The PMI data were collected between 12 and 26 August. Surveys were sent to around 5,000 private companies in the manufacturing and services sector.
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