FX.co ★ Italy Services Sector Contracts for First Time Since 2024

The S&P Global Italy Services PMI fell to 48.8 in March 2026 from 51.0 in February, confounding market expectations of a rise to 52.3. This reading signaled a renewed contraction in the services sector for the first time since November 2024, as activity declined amid fewer events following the Winter Olympics, generally subdued demand, and mounting international uncertainty. New business also shrank for the first time in over a year, with the rate of decline the steepest since November 2024. Meanwhile, employment was broadly stable compared with February, as limited hiring was offset by job cuts in other areas. On the cost side, input prices rose at the fastest pace in more than three years, driven by stronger wage pressures and higher costs for raw materials, energy, and fuel, largely associated with the ongoing conflict in the Middle East. Finally, business confidence weakened to a seven-month low, with service providers citing a difficult economic outlook and increased uncertainty stemming from geopolitical tensions.