Europe July Flash PMIs Firming Activity and Moderating Price Pressures

Economics Research 24 July 2026 | 11:32AM BST

Europe July Flash PMIs: Firming Activity and Moderating Price Pressures

BOTTOM LINE: The Euro area composite rose by 1.9pt to 51.9, above expectations Giovanni Pierdomenico | for a more modest improvement. Services activity rose by 2.2pt to 51.6 while Goldman Sachs International manufacturing output increased by 1.3pt to 53.0, the highest level in more than four years. The improvement was geographically broad-based, with Germany, France, and the periphery all rising sequentially. Composite input prices ticked down by 1.3pt to 63.1 (vs. 59.0 in February and a peak of 69.9). Output prices edged down by 1.1pt to 54.6 (vs. 53.1 in February and a peak of 57.1). The UK composite PMI also surprised to the upside in July, increasing by 2.8pt to 52.1. This reflected ongoing strength in manufacturing output and a rebound in services activity. Composite price components softened further but remain above the Euro area.

Note: The responses were collected between 09 and 22 July in all geographies.

n Euro Area Composite PMI (July): 51.9, GS 50.5, consensus 50.2, last 50.0 o Euro Area Manufacturing PMI (July): 52.0, GS 51.4, consensus 51.5, last 51.4 o Euro Area Services PMI (July): 51.6, GS 50.3, consensus 49.8, last 49.4 n France Composite PMI (July): 49.6, GS 47.9, consensus 47.8, last 47.2 n Germany Composite PMI (July): 51.2, GS 50.1, consensus 49.7, last 49.5 n UK Composite PMI (July): 52.1, GS 50.2, consensus 49.8, last 49.3

1. The Euro area composite rose by 1.9pt to 51.9, above expectations for a more modest improvement. The rise reflected an improvement in both sectors. Services activity rose by 2.2pt to 51.6 while manufacturing output increased by 1.3pt to 53.0, the highest level in more than four years. Composite employment ticked up to 50.3 and new orders also rose to a recent high of 52.2. Composite price components softened further. Input prices ticked down by 1.3pt to 63.1 (vs. 59.0 in February and a peak of 69.9). Output prices edged down by 1.1pt to 54.6 (vs. 53.1 in February and a peak of 57.1). Expectations improved, too.

n France: Composite output improved by 2.4pt to 49.6 in July, above expectations. After calendar effects weighed on the PMIs in May, the composite is now close its February levels. The improvement was driven by the services sector, where the

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activity index rose 3.0pt to a recent high of 49.8, while manufacturing output ticked down to 48.8. Composite new orders rose by 4.1pt to 50.0, largely driven by domestic orders. Composite employment remained soft (-1.3pt to 48.4). Input prices moderated further (-2.4pt to 60.5), most notably in the manufacturing sector. Composite output prices edged down by 0.5pt to 52.9. The release noted that some respondents “anticipate a slowdown ahead of the presidential election period next year, while others cited expectations of continued economic fallout from the Middle East war”. n Germany: The German composite PMI was firmer than expected at 51.2, vs. 49.5 in June. The improvement was visible in both sectors as services activity rose by 1.0pt to 49.6 and manufacturing output rose by 3.1pt to 54.7, the highest level in more than four years. Composite new orders, including from abroad, were firm on net, edging up above the 50-mark. Composite employment ticked up but remained softer at 48.6. Input prices ticked back up reflecting pressure in the services sector (+3.7 to 63.1) despite a moderation in manufacturing (-5.1pt to 68.2). Respondents cited the expiry of the temporary tax reduction on fuel and wage pressures. Composite output prices edged down by 0.2pt to 56.8 (vs. 53.9 in February). n Periphery: In the periphery, the composite PMI rose by 1.8pt to 54.1, reflecting a 2.4pt increase in services activity to 54.6 and a 0.2pt uptick in manufacturing output. Price components softened in the periphery, too. Composite output prices declined to 53.8, close to its February levels.

3. The UK composite PMI also surprised to the upside in July…