The S&P Global Spain Services PMI rose to 50.1 in May 2026 from 47.9 in April, above market expectations of 48 and signalling a stabilization in activity after the previous month’s contraction. The slight improvement was supported by a return to growth in new business, driven by stronger demand. However, growth remained modest as uncertainty linked to the Middle East conflict continued to weigh on market conditions and export orders declined for a fifth consecutive month. Input costs increased sharply, largely due to higher energy and fuel expenses, alongside rising supplier and labour costs. In response, service providers raised their selling prices, although output price inflation eased to a three-month low. Business confidence improved slightly but remained below historical norms due to ongoing geopolitical uncertainty. Despite this, firms expanded hiring, with employment growth strengthening through a mix of temporary and permanent recruitment.

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