Spain's manufacturing sector ended 2024 on a strong note, with both output and new orders accelerating in December, a survey by S&P Global showed, in a stark contrast with the rest of the euro zone.
The headline HCOB Spain Manufacturing Purchasing Managers' Index (PMI) rose to 53.3 in December from 53.1 in November, marking the 11th consecutive month above the 50.0 threshold that indicates growth.
The preliminary survey compiled by S&P Global in the euro zone two weeks ago showed a contraction of economic activity in December.
Demand Environment
The performance of Spanish manufacturing was bolstered by a robust demand environment, with notable increases in new export orders, particularly from Europe and North Africa. This strength in demand prompted firms to ramp up production and increase staffing levels for the fourth consecutive month.
Despite the positive output, firms faced challenges with supply chain disruptions, partly due to deadly floods in late October.
Input price inflation reached its fastest level in five months, driven by a strong U.S. dollar which lifted up the cost of imported goods.
Production 'Booming'
"Spain demonstrates resilience against the European weakness in the manufacturing sector. [...] The production in Spain's manufacturing sector is booming thanks to a strong order situation," Jonas Feldhusen, an economist at Hamburg Commercial Bank, said in the S&P report.
Looking ahead, Spanish manufacturers are optimistic, with confidence in the economic outlook improving to its highest since May 2024.
The country's central bank on Dec. 17 raised its economic growth forecast for the full year to 3.1% from a previous 2.8%. The economy grew 2.5% in 2023.
