March 03, 2023 08:30 GMT
Strong Services PMI Accompanied By Record Output Inflation Growth
SPAIN FEB SERVICES PMI 56.7 (FCST 53.7); JAN 52.7
- Spanish services jumped four points to a firmly expansive 56.7 in the February PMI print, outpacing forecasts of a more modest one-point uptick.
- This is the fourth month of growth and the highest services PMI since April 2022. Growth momentum stemmed from robust demand and employment in February.
- Yet the increase in service prices implies that further strength in the sector will add to inflationary pressures. Output cost inflation accelerated by the strongest rate on record in February, driven by strong wage pressures and energy costs.
- Yesterday Eurozone February core HICP accelerated by a surprise 0.3pp to a fresh euro-era high of +5.6% y/y, underpinned by the 0.4pp increase in services inflation.
- Further evidence of robust service cost inflation will continue to underline hawkish sentiment at the ECB.