Eurozone PMI Rebounds in September Signaling Stronger Growth

The eurozone's private sector activity showed a strong rebound in September, with the composite PMI index rising to 53.1 points, up from 52 in August. This marks the highest reading in 41 months and suggests a GDP growth of 0.4% in the third quarter, matching the pace seen in the previous three months.

The growth was primarily driven by the services sector, which saw its PMI increase to 53 points from 51.6 in August. Meanwhile, the manufacturing PMI improved slightly to 52.9 points, up from 52.7 the previous month.

Chris Williamson, chief economist at S&P Global Market Intelligence, noted that the services sector's fastest growth since November 2025 indicates an accelerating economic recovery extending beyond manufacturing. He highlighted that while Germany, France, and Italy showed positive trends, Spain stood out with its best quarter in five years.

The survey also detected a new increase in price pressures, suggesting inflation remains closer to 4% than the ECB's 2% target. This rise in inflation, combined with the growth acceleration, is expected to fuel speculation about a more aggressive tightening of monetary policy.