Business climate: economic sentiment surveyThe business climate is strengthening. The composite PMI improved significantly in Q4 (55.6 on average; +1.5 points compared to Q3), driven by the services index (56.4, compared to 54.2 in Q3). Strong domestic demand has led to an increase in activity and expectations for new orders. In manufacturing, the situation deteriorated in Q4 (51.1; -1.5 points q/q) due to a decline in production in December. Nevertheless, expectations for new business were rising, suggesting that the deterioration is temporary.
Households: retail trade (% change m/m, volume)High consumer confidence is supporting private consumption. Despite a slight decline over the last three months, consumer confidence remains high. Combined with a still-dynamic labour market, it supports consumption, with retail sales continuing to grow at a steady pace (+5.0% y/y on average in October–November). Private consumption is therefore likely to remain the main driver of Spanish growth in Q4, a trend that is expected to continue in 2026.
