The Eurozone HCOB Purchasing Managers’ Index (PMI), calculated by S&P Global, rose to 49.5 in January from 48.8 in December, marking the highest reading in recent months, though the figure remains in contraction territory. Meanwhile, the Industrial Production Index (IPI), which is part of the overall PMI, returned above the threshold and reached 50.5, up from 48.9 the previous month, indicating moderate output growth. At the same time, new orders fell for the third consecutive month.
Factory employment declined for the 32nd consecutive month, but the pace of layoffs was the lowest since September, which may signal gradual stabilization of the labor market. The dynamics were mixed across countries: the strongest readings were recorded in Greece, where the PMI reached a five-month high of 54.2, and in France at 51.2, the best result in more than three and a half years.
Meanwhile, manufacturing in Spain, Germany, Italy, and Austria remained in recession, with Austria experiencing the worst performance at 47.2 points. Pressure on the sector is compounded by rising costs – input prices increased at the highest rate in three years amid rising energy prices. Despite this, producer expectations for the coming year have improved to their highest level since February 2022, reflecting cautious optimism about a future recovery.