FX.co ★ Euro Area Services Sector Returns to Growth

The S&P Global Eurozone Services PMI rose to 51.6 in July 2026 from 49.4 in June, reaching a five-month high and clearly surpassing market expectations of 49.8, according to flash estimates. The latest reading signals a return to expansion in the services sector after three consecutive months of contraction, driven by a renewed increase in business activity.

Employment conditions also improved, with service providers leading overall job creation across the private sector. On the cost side, operating expenses continued to rise at a pace broadly similar to the previous month, underscoring ongoing input cost pressures. However, output price inflation eased, suggesting that firms are passing higher costs on to customers at a slower rate.

Business confidence strengthened as well. Sentiment regarding the year-ahead outlook improved across the services sector, with companies becoming more optimistic about future demand and the broader economic environment.