The eurozone manufacturing sector maintained its expansion in October 2026, marking a ninth consecutive month of growth, although the pace of improvement moderated slightly from September, according to the latest survey from S&P Global.
The S&P Global Eurozone Manufacturing Purchasing Managers’ Index (PMI) registered 52.7 in October, compared with 52.9 in September. The reading represented a two-month low but remained comfortably above the 50-point threshold separating expansion from contraction.
Manufacturing output, employment and purchasing activity continued to increase, while export orders recorded their strongest growth in more than four and a half years.
Factory Production Expands for Ninth Consecutive Month
Manufacturing production across the eurozone increased for the ninth successive month in October, extending the expansion recorded throughout much of 2026.
However, the pace of growth slowed to its weakest level in four months.
The manufacturing output index declined to 52.8 from 53.6 in September, indicating a moderation in production growth despite continued positive business conditions.
Six of the eight countries included in the survey reported expanding manufacturing activity during October, with growth rates exceeding their respective long-term averages.
France and Italy were the only two countries to register contractions, highlighting differences in manufacturing performance across the euro area.
Export Orders Record Strongest Growth in Over Four Years
Growth in new manufacturing orders slowed during October, suggesting some moderation in overall demand.
Nevertheless, export sales provided a significant source of support, increasing at their fastest pace in more than four and a half years.
The improvement in international orders helped sustain manufacturing activity despite slower growth in total new business.
Employment across the sector increased for the third consecutive month, indicating that manufacturers continued to expand their workforces.
Outstanding business also rose, with backlogs increasing at the same pace as September.
The rate of accumulation matched the strongest recorded since May 2022, suggesting that production capacity remained under pressure as manufacturers worked to fulfil existing orders.
Purchasing Activity Accelerates as Supply Chains Face Pressure
Eurozone manufacturers increased their purchasing activity at the fastest rate in nearly four and a half years during October.
The expansion reflected efforts to support production requirements and secure materials amid growing supply chain pressures.
Supplier delivery times lengthened to their greatest extent since June, indicating renewed difficulties in obtaining inputs.
Manufacturers also increased their inventories of purchased materials for the first time since December 2022.
The rise in input stocks suggested a shift towards greater inventory accumulation as businesses responded to demand conditions and potential supply disruptions.
Input Cost Inflation Reaches Highest Level Since May
Cost pressures intensified across the eurozone manufacturing sector during October.
Input prices increased at their fastest pace since May, marking a second consecutive month of accelerating cost inflation.
Manufacturers responded by raising their selling prices, passing some of the additional expenses on to customers.
Output price inflation remained elevated, although its rate of increase was little changed from September.
The combination of higher purchasing costs and longer supplier delivery times highlighted the inflationary pressures accompanying the sector’s continued expansion.
Defence Spending and Trade Changes Support Manufacturing Growth
Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, highlighted the resilience demonstrated by eurozone manufacturers during 2026.
“The sustained growth recorded since February paints an encouraging picture of resilience for the manufacturing sector,” Williamson said.
He identified increased defence expenditure, precautionary inventory accumulation and changing international trade patterns as factors creating additional business opportunities for manufacturers.
These developments have helped support industrial activity despite differences in performance between individual eurozone economies.
Eurozone Manufacturing Outlook
The October PMI figures indicate that eurozone manufacturing continued to expand, supported by stronger export demand, increased purchasing activity and rising employment.
However, the slower pace of output and new order growth suggests that the recovery remains uneven.
France and Italy continued to experience manufacturing contractions, while supply chain disruptions and accelerating input costs presented additional challenges.
The survey results point to continued industrial growth across much of the euro area, with developments in demand, production costs and supply conditions likely to influence activity in the coming months.
The data were collected between 12 and 23 October 2026.
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