Fresh business surveys suggest the eurozone economy is holding up better than expected, with both services and manufacturing registering stronger-than-forecast readings in June. The data point to a modest improvement in private-sector activity after months of sluggish growth across the bloc.

The latest PMI figures are being watched closely because they offer an early read on momentum ahead of the European Central Bank’s next policy meeting. Investors have increasingly priced in a steady interest rate decision, reflecting signs that inflation pressures have eased enough for officials to pause.

While the numbers do not point to a broad-based boom, they do indicate that Europe’s economy is showing resilience despite high borrowing costs and ongoing uncertainty in global trade. Economists say the recovery remains fragile, but the surprise uptick may reduce immediate pressure for the ECB to change course.

Markets will now focus on whether stronger activity data can continue into the summer, or whether the recovery loses steam as households and businesses continue to face tight financial conditions.