FX.co ★ Eurozone Manufacturing Downturn Eases as Output Grows for 1st Time in 2 Years

The HCOB Eurozone Manufacturing PMI recorded a reading of 48.6 in March 2025, slightly lower than the initial estimate of 48.7 but up from the final figure of 47.6 in February. While the index still reflects a contraction in the manufacturing sector, the decrease was minor, marking the slowest decline since January 2023. Interestingly, production saw its first increase in two years, achieving the fastest growth since May 2022, despite a continued drop in new business orders. Additionally, the reduction in backlogged work persisted, albeit at the most gradual rate since July 2022. Job reductions were less severe compared to February’s peak in over four-and-a-half years, indicating the least aggressive workforce trimming in seven months. On the pricing side, input cost inflation climbed to a seven-month high, although output price inflation remained marginal. Finally, business confidence fell to a three-month low.