Private-sector activity in the euro area accelerated in August, with the S&P Global/Hamburg Commercial Bank flash composite PMI rising to 51.1 from 50.9 in July—its highest level since May 2024 and the third consecutive month above the 50-point line that separates growth from contraction. The upturn was driven by industry: the manufacturing PMI climbed to 50.5, moving into expansion for the first time in more than three years, while manufacturing output registered its quickest increase in nearly three-and-a-half years. Services growth cooled slightly to 50.7, but new orders across the bloc increased for the first time since May 2024, and firms stepped up hiring at the fastest pace since June 2024. Germany, the region’s largest economy, recorded its strongest reading since March, with its composite PMI advancing to 50.9 as factories led the improvement. France’s downturn eased, with its composite index edging up to 49.7, the smallest contraction in a year. Outside the euro area, the United Kingdom’s composite PMI rose to 53.0, the best in 12 months, helped by a rebound in services. The manufacturing rebound came despite a US-EU trade agreement that locked in a 15% tariff on most European exports from April, a levy that analysts had feared would weigh more heavily on output. Survey respondents nonetheless flagged persistent weakness in foreign orders and a pick-up in input-cost inflation, suggesting the recovery remains fragile. Economists said the figures reinforce expectations that the European Central Bank will keep policy on hold when it meets in September, while monitoring whether rising cost pressures in services threaten to rekindle inflation.