BRUSSELS/FRANKFURT/PARIS (dpa-AFX) - The euro area manufacturing sector shrank at a slower pace in January as contractions in output, orders, inventories and purchasing activity slowed, final survey results from S&P Global showed on Monday.
The final HCOB manufacturing Purchasing Managers' Index rose to an eight-month high of 46.6 in January from 45.1 in December. The flash reading was 46.1.
Although the reading was below the critical 50.0 threshold, it signaled the softest fall since May last year.
Both orders and output declined at the slowest pace since May 2024. Moreover, export markets were less of a drag on factory sales performances, the survey showed.
Factories tapered their purchasing activity, although the decline was the softest seen for eight months. Stocks of inputs registered a weaker rate of depletion.
Staffing numbers were lowered at a faster rate in January as companies were still able to make inroads into their outstanding orders.
There was a renewed increase in operating expenses. Input prices increased for the first time since last August. However, firms refrained from passing on higher costs to their customers.
Further, manufacturers were more optimistic towards outlook for production. Growth expectations climbed to their strongest since February 2022.
'It's definitely too early to talk about green shoots in the manufacturing sector, but we see the increase in the HCOB PMI as a first step towards stabilisation, ending two months of the deepening of the recession,' Hamburg Commercial Bank Chief Economist Cyrus de la Rubia said.
'Despite all of Trump's tariff threats, we must remember that for most countries in the eurozone, 90% or more of exports go to countries other than the US,' said de la Rubia.
Among big-four economies, only Spain continued to expand. Meanwhile, France and Germany recorded the joint-lowest manufacturing PMI prints in January and Italy showed slower of contraction.
Germany's manufacturing downturn softened in January as output and new orders dropped at the slowest rates in eight months. The HCOB final manufacturing PMI rose to 45.0 from 42.5 in December. The score remained above the flash level of 44.1.
France's final factory PMI hit a seven-month high of 45.0 in January, reflecting some signs of improvement in underlying conditions. The score was up from 41.9 in December and also flash reading of 45.3.
At 46.3, Italy's manufacturing sector downturn remained solid amid sustained signs of challenging business conditions across the board. The index was little changed from December's 46.2. The sector contracted for the tenth straight month.
Spain's manufacturing activity continued to grow in January but the pace of expansion softened on weaker gains in output and new orders. The PMI slid to 50.9 from 53.3 in December. This was the slowest growth since last August.
Copyright(c) 2025 RTTNews.com. All Rights Reserved
Copyright RTT News/dpa-AFX
© 2025 AFX News
