Eurozone business activity accelerated in February, expanding at its fastest pace in three months. The HCOB Flash Eurozone Composite PMI Output Index rose to 51.9 from 51.3, marking the fourteenth consecutive month above the 50.0 growth threshold. Manufacturing sector led the improvement, with output increasing at the fastest pace since August 2025, while services activity also edged up slightly.

Manufacturing output climbed to a six-month high as the HCOB Flash Eurozone Manufacturing PMI Output Index reached 52.1 from 50.5. Germany recorded solid growth at its fastest pace in four months, while France showed little change from January. New orders increased marginally, with manufacturing seeing its first growth in new orders since August 2025 at the fastest pace in nearly four years.

Despite the expansion, inflationary pressures intensified with input costs rising sharply to a 34-month high. Employment decreased fractionally for the second consecutive month, ending a five-year sequence of job creation in services. Business confidence eased slightly but remained elevated, with manufacturing sentiment reaching a four-year high as firms expect continued growth in the coming year.