Spain's Private Sector Growth Driven by Services in July 2025
Spain's services sector led private sector growth in July 2025, with a PMI increase to 55.1.
Key Points
- • Spain's Composite PMI rose to 54.7, marking 20 months of growth.
- • The services sector was key, with a PMI of 55.1, the highest since February.
- • Manufacturing showed a slight increase with a PMI of 51.9 but is still below pre-pandemic levels.
- • Businesses remain optimistic despite international uncertainties concerning trade.
In July 2025, Spain's private sector activity showed robust growth, primarily fueled by the services sector, with a Composite PMI of 54.7, marking 20 consecutive months of expansion. The services sector recorded a PMI of 55.1, the highest since February, indicating a noteworthy increase in demand. In contrast, the manufacturing sector saw a slight improvement, achieving a PMI of 51.9, although it remains below pre-pandemic levels.
The growth in the services sector can be attributed to a rebound in new orders, as highlighted by the HCOB report prepared by S&P Global. Economists, including Cyrus de la Rubia from Hamburg Commercial Bank, remarked on the positive outlook for service companies heading into the summer months, emphasizing this strong start to the third quarter.
Despite these positive developments, businesses expressed caution due to international uncertainties, particularly relating to trade dynamics with the United States. Jonas Feldhusen, also from Hamburg Commercial Bank, mentioned that while recent GDP growth of 0.7% fuels optimism, potential changes in U.S. tariff policies could pose significant risks.
In the broader eurozone context, the composite PMI reached 50.9, indicating mild expansion, while the manufacturing sector recorded a PMI of 49.8. Employment figures saw improvement as companies adjusted hiring practices in response to anticipated workload increases, marking the best employment data observed since March 2025. However, rising supplier prices and fuel costs have led to increased selling prices, contributing to inflation levels not seen since May 2024.