Eurozone News
LAST UPDATE: July 3, 2025
Euro zone services sector returned to modest growth in June, PMI shows
In June, the HCOB services PMI rose to 50.5, reversing May’s contraction and signaling slight expansion. Composite PMI reached a three-month high of 50.6, but new business remained weak and France continued contracting .
Insight
The return to modest growth suggests resilience, but weak new orders and input price inflation may complicate the ECB’s outlook. Likely one more rate cut in September appears factored in.
The Italian job: how Rome plans to work around NATO spending hike
To meet NATO’s new 5% GDP defense target by 2035, Italy plans to reclassify civilian infrastructure—like ports, shipyards, and bridge projects—as defense-related, using dual-use investments and flexible EU fiscal rules .
Insight
Italy’s creative accounting highlights how nations can meet NATO goals without cutting social programs. It may set a precedent for other debt-laden allies seeking compliance with spending commitments.
Wildfire on Greek island of Crete scorches forest, forces evacuation of over 1,000
A wildfire near Ierapetra on Crete forced the evacuation of more than 1,000 residents and tourists. Fueled by gale-force winds and heatwave conditions, the fire burned forests, olive groves, homes, and hotels. Around 230 firefighters with engines and helicopters fought the blaze .
Insight
The wildfire underscores the growing climate-driven wildfire risk in Mediterranean regions. The combination of extreme heat, wind, and dry conditions highlights urgent needs for adaptation and forest management ahead of peak tourism season.
