Eurozone’s Factory Activity Surges To Over 3-Year High Despite Trump Tariffs

New orders also grew in August, ending a 14-month streak of declines.

Eurozone manufacturing activity has expanded so far in August, at the fastest pace since 2022, with new orders also growing at a rapid pace despite the onslaught of U.S. tariffs.

The HCOB Flash Eurozone Manufacturing Purchasing Manager’s Index (PMI) came in at 50.5, compared with 49.8 in July, breaching the key mark of 50, which separates expansion from contraction. New orders also grew in August, ending a 14-month declining streak.

“Despite headwinds like U.S. tariffs and general uncertainty, businesses across the eurozone seem to be coping reasonably well. The EU Single Market is likely playing a helpful role here,
especially since most export and tourism revenues are generated within the EU,” Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank, said.

Retail sentiment on Stocktwits iShares MSCI Eurozone ETF (EZU) was in the ‘neutral’ territory at the time of writing.

The survey noted that the rise in manufacturing new orders was the first since April 2022. Germany, the Eurozone’s largest economy, also saw robust growth in manufacturing output. Eurozone companies continued to hire additional staff in August, extending the current sequence of job creation to six months.

Late last month, the U.S. and the European Union agreed to a trade deal that included a 15% tariff on most European goods, including cars. While it was less than what Trump had initially threatened to slap on exports from the 27-nation bloc, the survey showed that orders from abroad have continued to slip in August.

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