US DATA: Challenger Layoffs On The Higher Side But At Least Improve From 2025

Spain's March services PMI increased further into expansion at 53.3 (50.6 cons, 51.9 Feb), showing resilience in the wake of the Middle East conflict. Meanwhile, Italy's services PMI fell into contraction at 48.8 (50.9 cons, 52.3 Feb), likely helped lower by the end of the Winter Olympics. In both releases it was reported that confidence has weakened and input prices have risen notably, though Italian firms are reported to be soaking up a larger proportion of cost increases.

• On prices, the press releases note the Middle East conflict raised input prices but output prices diverged, rising more in Spain: "a noticeable acceleration in input price inflation, which hit its highest level for nearly three years. Output charges were increased in response to the greatest degree since August 2025." Whereas in contrast in Italy: "Prices data pointed towards an intensification of costs, most of which was absorbed by firms, as charge inflation picked up but to a much smaller extent."
• Spain saw sustained service sector growth in March: "Service providers continued to report higher volumes of incoming new business, although growth overall was the weakest for nine months ... [Middle East conflict] was reported to have led to a noticeable degree of market uncertainty and hesitancy amongst clients, especially those based outside of Spain. New export business declined in March for a third month running and at the quickest rate since January 2024... confidence regarding future activity sinking to its lowest since September 2023. Service providers are especially concerned about inflation and its adverse impact on spending."
• Italy's services PMI fell into contraction for the first time since late 2023: "demand contracted in both domestic and external markets ...  The growth trend seen in employment which spanned over a year broadly stalled, and confidence deteriorated." Some pullback in activity following the Winter Olympics throughout Feb was also highlighted by panellists.
• The Eurozone final services PMI (also released this morning) came in at a ten-month low 50.2 (50.1 flash, 51.9 Feb), but still expansionary. On prices, the press release notes: "Cost pressures intensified in March, with inflation accelerating to a 34-month high... Prices charged increased, although the extent of the latest rise was fractionally slower than that seen in February."

• Net ILTR usage fell GBP455mln to GBP73.728bln outstanding. Gross takeup today was GBP2.081bln.
• This is the sharpest net reduction in ILTR usage so far this year - recall that around six months ago the TFSME repayments were being made and usage of the ILTR (and STR) was increasing rapidly.
• We don't think this is too notable, however, particularly given last week's GBP1.409bln takeup - which means the 2-week increase is still GBP954mln.