Eurozone Business Activity Hits 7-Month High

The Flash Eurozone Composite PMI Output Index, a key indicator of both services and manufacturing business activity, climbed to 50.4 in March from February's 50.2, marking a 7-month high. This preliminary data, released by S&P Global and Hamburg Commercial Bank (HCOB), highlights a slight but significant uptick in economic activity across the region.

Mixed Signals from Services and Manufacturing Sectors

While the Flash Services PMI Business Activity Index experienced a slight dip to 50.4, down by 0.2 points from February and reaching a 4-month low, the manufacturing sector told a different story. The Flash Eurozone Manufacturing PMI reached a 26-month high of 48.7, showcasing resilience amidst global economic uncertainties.

ECB's Monetary Policy in Focus

"The price trends in the services sector, closely monitored by the ECB, are likely to please the more dovish members of the monetary authority," noted HCOB Chief Economist Cyrus de la Rubia. He also pointed out that in manufacturing, both selling and purchasing prices are rising moderately, aided by decreasing energy costs. However, de la Rubia cautioned, "The ECB remains vigilant against potential risks, including possible retaliatory tariffs from the US."