Spain manufacturing decline continues in January

Spain's manufacturing sector "experienced a subdued start to 2026" with its second consecutive month of declines, S&P Global said on Monday.

The seasonally adjusted HCOB Spain manufacturing purchasing managers' index recorded 49.2 points in January, down from 49.6 in December and below FXStreet-cited market consensus of a rise to 49.9 points.

December's figure marked the "weakest PMI reading since last April", S&P Global said, and the second month in a row that the PMI has remained below the 50-point neutral mark separating growth from contraction, showing "another marginal deterioration in operating conditions".

"Spain's manufacturing sector has entered the new year on a weak footing," said Hamburg Commercial Bank junior economist Jonas Feldhusen. "December's disappointing PMI figures had already raised the question of whether the downturn was merely a temporary setback or the beginning of a more persistent soft patch. The January data now suggests that the latter is more likely.

"Although production has stabilised, the deterioration in demand conditions is becoming increasingly concerning. Both domestic and foreign new orders declined further, despite already subdued levels."

Feldhusen added that "many panellists attribute the softer demand environment to ongoing global uncertainty".

Looking ahead, Feldhusen commented: "Despite the loss of momentum, Spanish manufacturers retain a notably upbeat view of the year ahead. Many manufacturers continue to anticipate stable demand throughout 2026 and are confident that ongoing investments and newly launched projects will pay off.

"However, external challenges persist. Intense competition from outside Europe and the continued entanglement of geopolitical and trade-related uncertainties - most recently exemplified by developments surrounding Greenland - are prompting clients to delay investment decisions."

The manufacturing PMI is compiled by S&P Global from survey responses by purchasing managers in a panel of around 400 manufacturers in Spain. The responses were collected between January 12 and 23.