FX.co ★ Italian Construction Sees Modest Growth in May

The HCOB Italy Construction PMI experienced a slight increase to 50.5 in May 2025 from 50.1 in April, indicating a continued yet modest growth in the sector. This growth was primarily fueled by a minor uptick in new orders, bolstered by public tenders and the ongoing stimulus from the National Recovery and Resilience Plan. The commercial construction sector remained the principal contributor to this growth. Conversely, residential building experienced contraction for the second consecutive month, and civil engineering saw a considerable decline, although it was less severe compared to the previous year. Employment within the sector rose at the fastest rate observed in 2025, with firms predominantly hiring on permanent contracts to address the demand. Despite this, purchasing activity decreased as companies opted to use existing inventories amid escalating input costs. Regarding prices, cost pressures heightened due to increased expenses for raw materials, energy, and transportation, while delivery times deteriorated for the eighth consecutive month. In the face of these challenges, business sentiment reached a one-year high, as companies remained cautiously optimistic about future activity and anticipated incoming projects.