The HCOB Italy Services PMI rose to 53.2 in May 2025 from 52.9 in the previous month, exceeding market expectations of 52.3. This marked the sixth consecutive month of expansion and the strongest reading since June 2024, reflecting a pickup in customer demand and a steady inflow of new orders. While the pace of new order growth softened slightly, it remained elevated by historical standards, suggesting that the recovery is gaining traction. Employment growth accelerated to its strongest pace since July 2024 and notably above the long-term average, helping firms reduce backlogs of work for the third straight month. Meanwhile, input cost inflation remained elevated, driven by higher energy prices and wage burdens, prompting firms to raise their selling prices at the fastest rate in over a year. Lastly, confidence improved to its highest in three months, with nearly one-third (32%) of respondents anticipating increased activity over the year.