Euro Zone Composite PMI Jumps to 53.1 in September, Defying Forecasts for Slowdown

Euro zone business activity accelerated in September at its fastest pace since April 2023, with the S&P Global Flash Euro Zone Composite PMI Output Index rising to 53.1 from 52.0 in August, beating Reuters poll expectations of a drop to 51.7. A reading above 50.0 indicates expansion. The services PMI climbed to 53.0 from 51.6, its highest in nearly a year, while the manufacturing index held at 52.7 and its output gauge edged up to 53.4 from 53.3. New orders grew at their fastest rate in over four years, supported by rising exports. Firms reported steeper input cost increases tied to elevated energy prices and hired more staff to meet demand. The European Central Bank, which raised rates twice this year to combat energy-driven inflation, faces growing pressure to hike again, with markets pricing three more increases by end-June and an October move now seen as increasingly likely.