Spain service sector rises for 27th month in-a-row but expansion eases

Spain's service sector registered another month of growth in November, but expanded at a slower pace, according to a purchasing managers' index survey.

The Hamburg Commercial Bank's Spain services PMI faded to 55.6 points in November, from 56.6 in October. Moving closer to the 50-point neutral mark, the reading suggests the pace of expansion eased.

Nonetheless, it extends the growth streak in Spain's services sector to 27 months, survey publisher S&P Global noted.

"Higher activity was linked to working on new projects, existing contracts and new work. Latest data showed that demand improved again in November, with new business volumes rising for a fifth successive month. Growth was however the slowest since August, in part undermined by a drop in international sales which fell in November for the first time in five months. Moreover, the downturn was the steepest since the start of 2024. Panellists simply reported a lack of international demand," S&P Global said.

"Service providers nonetheless remained suitably upbeat with regards future output as confidence was little changed since October and therefore still above its historical trend. Market demand is widely expected to remain positive in the coming 12 months, whilst firms are planning for new projects and the release of new services."

The composite PMI, calculated using the services and earlier manufacturing readings, fell to 55.1 in November from 56.0 in October.

"Rising levels of activity have now been recorded continuously for the past two years, with growth again primarily led by the services economy as manufacturing output rose but to a lesser degree. New business volumes also increased and with capacity under some pressure firms continued to take on additional workers – although growth was broadly confined to the services economy. Cost inflation was little changed meanwhile at an above average rate, but selling prices rose to the weakest degree in a year amid discounting in the manufacturing economy," S&P Global said.

Spain's manufacturing extended its growth streak in November, though the pace of progress abated, a PMI on Monday showed.

The latest Hamburg Commercial Bank manufacturing PMI fell to 51.5 points in November, from 52.1 in October.

The services PMI features a panel of 350 service sector firms. Responses were collected between November 12 and 25.