FX.co ★ Spain Services Sector Unexpectedly Slows

The S&P Global Services PMI slipped to 57.8 in August 2026 from 58.3 in July, coming in below analysts’ expectations of 59 but remaining firmly in expansionary territory. Despite the slight pullback, it was still the second-highest reading in nearly three and a half years, signalling continued solid growth in the sector.

New business increased for a fourth consecutive month, supported by strong domestic demand, while export growth remained modest amid ongoing geopolitical uncertainty. Employment continued to rise, but the pace of hiring slowed to a four-month low, as some firms chose not to replace departing staff. This pointed to a degree of caution over workforce expansion, with companies increasingly turning to technology to enhance productivity in the face of rising labour costs.

Input price inflation eased to its lowest level since January but stayed elevated, reflecting higher energy, fuel and wage pressures. Firms raised output charges at a faster rate than in July. Meanwhile, business confidence weakened to a three-month low and remained below its long-term trend, even as companies expressed some optimism about an eventual improvement in geopolitical and macroeconomic conditions.