Europe, Services PMI – Final (March) – [April 07 2021]

• The eurozone services PMI increased to 49.6 in March from 45.7 in February, 0.8 pts up from consensus’ expectations. Encouragingly, today’s data confirmed the services sector is on the path to recovery. Despite the health situation remains fragile and some restrictions are being extended, optimism about the vaccine campaigns sends some hopes for the services sector outlook.

France and Spain saw their services PMIs increasing over the month, German services index recorded a strong gain and surpassed the 50 no-change mark, while Italy’s services sector continued to suffer in March.

• In Italy, the services PMI for March decreased to 48.6 from 48.8 in February. A decline in activity and new business weighed on the sector, with also foreign demand suffering. Nonetheless, the Italian services sector fared relatively well during the month, when restrictions have been tightened across the country. Confidence also improved, boosted by strong recovery and loosened restrictions hopes.

• Conversely, in Spain the services PMI expanded by 5.0 pts to 48.1 in March, beating also consensus’ expectations. Activity in the sector benefitted from weaker reductions in activity and new business. With confidence about the year ahead staying at high levels, we expect Spain’s services sector to recover gradually in the coming months, together with restrictions being eased.