Eurozone Business Activity Expands in Early 2026 as Price Pressures Reemerge

Growth is back, but the bill's getting bigger. According to Reuters, Eurozone business activity is expanding steadily as of January 23, 2026. However, a worrying resurgence in price pressures is threatening to complicate the economic recovery and the central bank's next moves.

Eurozone Business Activity Hits Multi-Month Highs

The latest data shows that private sector output across the Eurozone has maintained a solid upward trajectory. Services remain the primary engine of growth, while the manufacturing sector is finally stabilizing after a period of volatility. Businesses report increased confidence, leading to a steady rise in new orders and headcounts.

The Inflation Ghost Returns to Haunt Markets

It's not all good news for your wallet. Input costs are climbing again, driven by persistent wage growth and rising energy logistics costs. This trend has forced firms to hike their selling prices at the fastest pace in months. This re-emergence of inflation puts the European Central Bank (ECB) in a tough spot, as they were widely expected to continue cutting interest rates throughout 2026.