Italy manufacturing activity remains in contraction in January

The manufacturing sector in Italy showed signs of a softening downturn in January, results from a S&P Global survey showed on Monday.

The manufacturing purchasing managers' index rose to 48.1 points in January 2026 from 47.9 in December 2025, meeting market expectations cited by FXStreet. The reading remains below the 50-point neutral market, indicating contraction in activity.

The continued weakness was linked to fragile demand, order cancellations ,and challenging market conditions, while export sales fell again, but only marginally, S&P Global said.

Despite weaker demand for inputs, input costs rose sharply, marking the strongest cost inflation since November 2022, driven by higher prices for a range of raw materials, according to survey respondents.

Looking at the future, business confidence improved significantly, reaching one of its highest levels in nearly four and a half years, supported by new product launches, lower borrowing costs and expectations of a broader sector recovery.

The PMI survey features a panel of 400 manufacturers in Italy. Responses were collected between January 12 and 23.

The services and composite PMIs for January will be released on Wednesday.