Spain: Composite PMI rose to highest print since late 2021 in March
The S&P Global Composite Purchasing Managers’ Index (PMI) rose to 58.2 in March from February’s 55.7, marking the strongest expansion since November 2021. Consequently, the index moved further above the 50-threshold, signaling an improvement in business activity from the previous month.
The S&P Global Manufacturing PMI rose to 51.3 in March from 50.7 in February. Output and employment rose at the sharpest pace in over a year, while new orders continued to increase. Meanwhile, confidence dipped but remained relatively high. On the price front, input costs dropped for the first time in 32 months, while output prices increased at the softest pace in 28 months.
The S&P Global Services PMI rose to 59.4 in March from 56.7 in February. Faster increases in new orders and activity supported the reading. Moreover, jobs were added at a sustained pace. In terms of prices, both input and output inflation decelerated slightly but remained elevated. Lastly, business confidence weakened but remained upbeat amid hopes of a continued recovery in demand.
Commenting on the outlook, Wouter Thierie, economist at ING, stated:
“Thanks to a significant fall in energy prices and continued improvement in supply chain disruptions, the first and second quarters are likely to be better than previously expected. We now pencil in growth of 0.3% quarter-on-quarter in the first quarter of this year. However, the momentum of the Spanish economy is expected to slow down in the second half of the year. This is mainly due to interest rate hikes and the tightening of financial conditions that will have an increasing impact on the economy.”