Spain's manufacturing industry rebounded in May, marking its first expansion since January, driven by improved sales and easing global trade tensions, according to a survey released Monday.

The HCOB Spain Manufacturing Purchasing Managers’ Index (PMI), compiled by S&P Global, rose to 50.5 in May from 48.1 in April. A reading above 50.0 indicates growth, suggesting a return to expansion after four months of contraction.

This upturn was primarily due to a modest increase in production, supported by improved demand and reduced global tariff uncertainty following the partial lifting of U.S. trade restrictions.

“Spain’s direct trade links with the U.S. are limited compared to countries like Germany or Italy, but it may still be benefiting from a broader improvement in global trade sentiment,” said Jonas Feldhusen, Junior Economist at Hamburg Commercial Bank.

Looking forward, business confidence climbed to its highest level in three months, as firms anticipated a more stable economic environment over the coming year. Nonetheless, ongoing unpredictability in U.S. trade policy under President Trump continues to pose challenges for long-term planning.

While Spain’s overall economic growth slowed slightly in the first quarter, manufacturing remained a bright spot. According to the National Statistics Institute, the sector continued to expand rapidly. The Spanish government maintains its forecast for 2.6% economic growth in 2025—outpacing peers like France, Germany, and Italy. Photo by Álvaro Ibáñez from Madrid, Spain, Wikimedia commons.