Spain’s service sector grows at slowest pace since Jan, PMI shows
2024.12.04 03:53
MADRID (Reuters) – Spain’s services sector grew last month but at the slowest pace since January, a survey showed on Wednesday, as the country’s deadliest floods in modern history took a toll.
The HCOB Spain Services PMI Business Activity Index, compiled by S&P Global, fell to 53.1 in November from 54.9 in October. Any reading above 50.0 indicates expansion.
The decline was partly attributed to floods in the Valencia area that killed more than 200 people on Oct. 29 and 30.
Despite the slowdown, firms continued to hire, extending a 26-month streak of employment growth, as they sought to manage increased workloads. Input costs remained high, driven by rising wages.
“The Spanish service sector is busy hiring. This is unsurprising, given that business continues to thrive, and backlogs are increasing,” said Jonas Feldhusen, Junior Economist at Hamburg Commercial Bank.
The floods affected new business growth, which hit a three-month low, the survey said. New export business declined for the first time since February.
Confidence in future business activity remained positive, with companies expecting broader market activity to strengthen, supported by new commercial activities.
The composite PMI, which includes both manufacturing and services, dropped to 53.2 from 55.2 in October, marking the slowest private sector expansion since January.
The November PMI data suggest Spain’s growth momentum has continued into the fourth quarter after a robust expansion of 0.8% in the third. Spain’s central bank estimates the floods may have cost 0.2% of the country’s GDP in the fourth quarter.
