Eurozone private sector activity fell short of expectations in December due to an unexpected deterioration in the German industrial sector. The composite purchasing managers' index compiled by S&P Global declined slightly to 51.9 from 52.8 in November, but is still above the 50 boom-bust line. Analysts had previously predicted that the index would remain largely unchanged. Germany was the main point of weakness. The manufacturing industry fell to its lowest point in 10 months, and the service sector did not perform well. In contrast, the French plant recorded its strongest growth in more than three years, and the performance surprised analysts. “The weak performance is mainly due to the worsening decline in German industry,” Hamburg Commercial Bank economist Cyrus de la Rubia said in a statement on Tuesday. “All in all, the beginning of the new year seems rather unstable.” In the face of trade turmoil and geopolitical pressures, Europe has been struggling to achieve growth. After a solid third quarter, the European economy will lose some momentum in the last few months of 2025 before picking up again in the new year. These data will help inform the ECB, which will make the last interest rate decision of the year on Thursday. Investors and analysts believe that in the foreseeable future, the current economic trajectory will not change monetary policy, and inflation will remain near the 2% target.

Eurozone private sector activity fell short of expectations in December due to an unexpected deterioration in the German industrial sector. The composite purchasing managers' index compiled by S&P Global declined slightly to 51.9 from 52.8 in November, but is still above the 50 boom-bust line. Analysts had previously predicted that the index would remain largely unchanged. Germany was the main point of weakness. The manufacturing industry fell to its lowest point in 10 months, and the service sector did not perform well. In contrast, the French plant recorded its strongest growth in more than three years, and the performance surprised analysts. “The weak performance is mainly due to the worsening decline in German industry,” Hamburg Commercial Bank economist Cyrus de la Rubia said in a statement on Tuesday. “All in all, the beginning of the new year seems rather unstable.” In the face of trade turmoil and geopolitical pressures, Europe has been struggling to achieve growth. After a solid third quarter, the European economy will lose some momentum in the last few months of 2025 before picking up again in the new year. These data will help inform the ECB, which will make the last interest rate decision of the year on Thursday. Investors and analysts believe that in the foreseeable future, the current economic trajectory will not change monetary policy, and inflation will remain near the 2% target.