The euro zone's beleaguered manufacturing industry showed some signs of stabilisation at the start of the year as firms brushed off rising costs and the threat of U.S. tariffs to become more upbeat about the outlook, a survey showed. HCOB's final euro zone manufacturing Purchasing Managers' Index, compiled by S&P Global, climbed to 46.6 in January, ahead of a preliminary estimate for 46.1 and closer to the 50 mark separating growth from contraction.

Northvolt AB’s appointed bankruptcy lawyers in the U.S. have sent a letter to creditors in Sweden threatening legal action if they don’t return to the company funds seized by the country’s Enforcement Authority, according to Bloomberg News reported. The steps to recover claims “violate United States federal law and an order from the US Bankruptcy court,” Christopher T. Greco, a lawyer for Kirkland & Ellis LLP, wrote in the letter seen by newspaper Dagens Industri.

Germany’s unemployment rate crept higher in January with manufacturing layoffs gathering steam, reflecting just one of the growing economic challenges facing the next government after upcoming elections, the Wall Street Journal reported. The adjusted unemployment rate in Europe’s largest economy was 6.2% this month, data from the Federal Employment Agency said Friday, up from the 6.1% of December. Registered job vacancies stood at 632,000, around 66,000 fewer than the same point last year. Jobless claims ticked up 11,000 in January, a tad more than the 10,000 of December.

French inflation was stable at the beginning of the year, figures showed Friday, a day after the European Central Bank again lowered its key interest rates amid a eurozone economy going nowhere fast, the Wall Street Journal reported. Consumer prices were 1.8% higher on year in January, the same rate as in December, according to EU-harmomized numbers published by France’s statistics authority. That was a little less than economists had expected, according to a poll compiled by The Wall Street Journal, and keeps inflation below the 2% threshold targeted by the ECB.

Bank of England Governor Andrew Bailey said that “very big decisions” will be needed to stop Britain’s public debt pile spiraling higher, as he gave his backing to the government’s efforts to boost growth, Bloomberg News reported. Bailey told lawmakers on Wednesday that climate change, an aging population and an end to the “post-Cold War dividend” on defense spending are “very big structural headwinds” facing the already-stretched public finances.

The European Central Bank lowered borrowing costs for a fifth time since June, with the region’s economy stalling and the 2% inflation target in reach, Bloomberg News reported. Investors maintained bets for further easing, pricing an additional 70 basis points of cuts during the rest of 2025. The euro held earlier losses, trading down 0.2% at about $1.0405. European bonds continued to trade higher.

The eurozone economy returned to stagnation as 2024 drew to a close, a blow to its hopes for a recovery as it braces for the possibility that U.S. President Trump will deliver a long-threatened increase in tariffs, the Wall Street Journal reported. The currency area’s economy has struggled to recover from a sharp rise in energy and food prices triggered by Europe’s largest military conflict in eight decades, even as the U.S. economy forged ahead.