EU HCOB Manufacturing Final PMI (Dec) 48.8 vs. Exp. 49.2 (Prev. 49.2)

“The manufacturing sector has been in recession almost continuously since mid-2022. 2025 was shaping up to be the year when the economy in this sector could turn around. In fact, the downturn did ease considerably, but it did not manage to shift to a sustainable growth trajectory. For 2026, however, there is hope that Germany's economic stimulus program and rising defence spending across Europe will breathe new life into the industry. Many companies obviously see it this way too, as confidence that production will be higher in a year's time than it is today has risen again from an already high level."
“There were some surprising regional developments in December. Spain's manufacturing sector, which had been expanding almost continuously since 2024, has now slipped slightly into decline. France's manufacturers, on the other hand, which have practically been in decline for three years, are showing signs of life again in December. The sharp slump in German and Italian industry is another disappointment. The relatively good performances in Greece and Ireland cannot compensate for this. Overall, it will not be easy for the manufacturing sector of the eurozone to gain a foothold in 2026. However, expansionary fiscal policy could help.”