HCOB Composite PMI for Spain: December 2025 Release and Macro Implications
The latest HCOB Composite PMI for Spain, released on December 3, 2025, registers at 55.10, slightly below market expectations of 55.50 and down from November’s 56.00. This report provides a timely snapshot of Spain’s economic momentum, capturing both manufacturing and services sectors. Drawing on data from the Sigmanomics database, this analysis compares recent readings with historical trends and explores the broader macroeconomic context, including monetary policy, fiscal stance, external risks, and market sentiment. The report concludes with forward-looking scenarios to guide investors and policymakers.
Table of Contents
The HCOB Composite PMI for Spain remains comfortably above the 50 expansion threshold at 55.10 in December 2025. This marks a slight deceleration from November’s 56.00 but continues to signal robust economic activity. Over the past 12 months, the average PMI stands at 54.30, indicating sustained growth despite global uncertainties. Spain’s PMI performance aligns with broader Eurozone trends, where composite PMIs have hovered in the mid-50s, reflecting moderate expansion.
Drivers this month
- Services sector growth remained strong, contributing approximately 0.35 points to the composite index.
- Manufacturing output showed a modest slowdown, subtracting around -0.25 points.
- New export orders softened amid weaker global demand, impacting the headline figure.
Policy pulse
At 55.10, the PMI sits above the European Central Bank’s (ECB) neutral growth benchmark but below the peak seen in late 2025. This suggests the economy is expanding but at a pace that may ease inflationary pressures, supporting the ECB’s cautious stance on further rate hikes.
Market lens
Immediate reaction: The EUR/USD currency pair dipped 0.15% within the first hour post-release, reflecting slight disappointment versus expectations. Spanish 2-year government bond yields edged down by 3 basis points, signaling mild easing in risk premiums.
Spain’s PMI reading complements other core macroeconomic indicators, painting a nuanced picture of the economy’s health. Industrial production growth slowed to 1.20% YoY in November, down from 1.80% in October. Meanwhile, retail sales rose 0.80% MoM, supported by resilient consumer spending. Inflation moderated to 2.40% YoY, easing from 2.70% the prior month, consistent with the PMI’s signal of slower price pressures.
Monetary Policy & Financial Conditions
The ECB’s main refinancing rate remains at 3.75%, unchanged since October. Financial conditions in Spain have tightened slightly due to higher sovereign spreads, but credit growth remains positive at 4.50% YoY. The PMI’s moderate cooling supports the ECB’s wait-and-see approach, balancing growth risks against inflation control.
Fiscal Policy & Government Budget
Spain’s fiscal deficit narrowed to 3.10% of GDP in Q3 2025, down from 3.50% in Q2, reflecting improved tax revenues and controlled spending. The government’s recent stimulus measures targeting green energy and digital infrastructure continue to underpin services sector expansion, as reflected in PMI services subindices.
This chart highlights a resilient Spanish economy that is trending upward but showing signs of moderation. The composite PMI’s slight dip signals a cooling phase after a strong run, suggesting that growth drivers are shifting from manufacturing to services, with external demand posing downside risks.
Market lens
Immediate reaction: Spanish equities, represented by the IBEX35, declined 0.40% post-release, reflecting investor caution. The EUR/USD pair’s dip was short-lived, recovering within two hours as broader Eurozone data remained supportive.
Looking ahead, Spain’s economic trajectory will depend on several factors. The baseline scenario (60% probability) envisions steady growth with PMI stabilizing around 54-55, supported by domestic demand and moderate export recovery. Inflation is expected to remain near the ECB’s 2% target, allowing for a pause in monetary tightening.
Bullish scenario (20%)
- Stronger-than-expected global demand boosts exports and manufacturing PMI above 56.
- Fiscal stimulus accelerates digital and green investments, lifting services PMI above 58.
- ECB signals accommodative policy, supporting credit growth and investment.
Bearish scenario (20%)
- Geopolitical tensions disrupt supply chains, pushing PMI below 52.
- Inflation spikes force ECB to tighten further, dampening consumer spending.
- Fiscal consolidation slows growth, increasing unemployment and reducing PMI.
Policy pulse
Monetary policy will remain data-dependent. The ECB’s next meeting in January 2026 will weigh PMI trends heavily. Fiscal policy is likely to maintain supportive measures but with an eye on deficit targets.
The December 2025 HCOB Composite PMI for Spain confirms ongoing economic expansion, albeit at a moderated pace. The slight decline from November’s peak reflects normalizing growth amid external headwinds. Policymakers face a balancing act between sustaining growth and managing inflation. Financial markets reacted cautiously but remain optimistic about Spain’s medium-term prospects. Investors should monitor export trends and ECB signals closely as key drivers of the next phase.
Key Markets Likely to React to HCOB Composite PMI
The HCOB Composite PMI is a critical barometer for Spanish economic health and influences several tradable markets. The IBEX35 equity index tracks domestic corporate earnings sensitive to economic cycles. The EURUSD currency pair reflects investor sentiment on Eurozone growth prospects. Sovereign bond yields, such as the ES10YT, respond to inflation and fiscal outlooks. The BTCUSD crypto pair often reacts to risk sentiment shifts triggered by macro data. Lastly, the EURGBP pair is sensitive to relative growth and policy divergences between Spain’s Eurozone peers and the UK.
Insight: PMI vs. IBEX35 Since 2020
Since 2020, the HCOB Composite PMI and the IBEX35 index have shown a strong positive correlation (r=0.72). Periods of PMI expansion above 54 have coincided with rallies in the IBEX35, while PMI contractions below 50 have preceded market downturns. This relationship underscores the PMI’s value as a leading indicator for Spanish equities, especially in volatile global environments.
FAQs
- What is the HCOB Composite PMI for Spain?
- The HCOB Composite PMI is a monthly survey-based indicator measuring economic activity in Spain’s manufacturing and services sectors.
- How does the PMI affect Spain’s economy?
- The PMI signals economic expansion or contraction, influencing monetary policy, investment decisions, and market sentiment.
- What are the risks to Spain’s PMI outlook?
- Risks include geopolitical tensions, inflation volatility, and shifts in global demand impacting exports and domestic growth.
Key takeaway: Spain’s December 2025 PMI confirms steady growth with emerging headwinds, requiring vigilant policy calibration and market monitoring.
Author
This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.
The December 2025 PMI at 55.10 compares with November’s 56.00 and the 12-month average of 54.30, indicating a slight month-on-month slowdown but sustained above-trend growth. The manufacturing PMI component fell from 54.20 to 53.30, while the services PMI edged down from 57.10 to 56.50.
New orders and employment indices both softened, with new export orders declining from 52.80 to 51.40, reflecting global demand headwinds. Input price inflation eased to its lowest level since early 2024, consistent with the moderation in headline inflation.