Spain September services PMI 57.0 vs 54.0 expected

• Services PMI 57.0 vs 54.0 expected and 54.6 prior
• Composite PMI 56.3 vs 53.5 prior.

Key findings:

• Uplifts in new business and activity growth signalled.
• Employment levels raised markedly.
• Cost inflation down to three-and-a-half year low.

Comment:

Commenting on the PMI data, Jonas Feldhusen, Junior Economist at Hamburg Commercial Bank, said:

“The summer is coming to an end and Spain is coming up with a little surprise, as the latest PMI data shows signs of
accelerated growth in September, although we anticipated growth to cool down somewhat in the second half of the year.
This once again sets Spain apart from the other major eurozone countries. Business activity and new business rose amid
reports of a further uplift in market demand.

One could argue that private consumption remains the main growth driver for
the economy, as retail trade also expanded in recent months. Nevertheless, one should remain cautious with the current
interpretation of the PMI for September. To identify a clearer trend, attention should already be directed toward October,
which will provide more indications of the growth trajectory toward the end of the year.

Great news for Spanish employees. With the progressing upturn in sales and demand, firms are accelerating their staffing
levels in order to handle their outstanding business, which further extended in September. The corresponding employment
index rose to the highest level in 17 months. Against this backdrop, future confidence rose to the highest level in three
months, as panellists expressed a desire to launch new projects and expand their range of services.

Little change on the price front. With still increasing wages, input prices again rose noticeably, and associated prices
charged also increased but at a softened pace. As mentioned in the last month, price pressures seem to be easing. The
latest inflation data for September registered at 1.5%, falling below the ECB’s target rate of 2% and signalling a further
softening of inflationary pressures.”