Italian Private Sector Growth Hits 3-Month High

The HCOB Italy Composite PMI rose to 51.7 in August 2025 from 51.5 in July, reaching a three-month high and signaling continued private sector growth. The improvement was driven by renewed growth in manufacturing (50.4 vs. 49.8), which offset a softer expansion in services (51.5 vs. 52.3). New business inflows accelerated to their strongest pace in 16 months, largely led by services, though manufacturing orders also increased slightly for the first time in nearly 18 months. Employment continued to grow steadily, while backlogs of work fell further, highlighting spare capacity, particularly among manufacturers. On costs, services firms reported rising operating expenses, while manufacturers saw a slight easing in input prices. Overall cost inflation remained sharp, though output charges rose at the slowest pace since November 2024. Business confidence, however, weakened to a four-month low.