Spanish manufacturing activity grew in May at the fastest pace in more than two years as domestic and overseas demand increased, a survey showed on Monday.

The HCOB Purchasing Managers' Index (PMI) for Spain's manufacturing sector, compiled by S&P Global, stood at 54 in May, up from 52.2 in April. The reading was the fourth consecutive above 50, denoting growth in activity, and the fastest since March 2022, when it was 54.2.

Manufacturing is sold as Spain has outperformed other big European Union economies, expanding by 0.7% in the first quarter while the 20-country euro zone as a whole grew a scant 0.3%.

"The economic upturn was mainly driven by the continued strong demand in the domestic market," Jonas Feldhusen, junior economist at Hamburg Commercial Bank, said of the May PMI data.

Business people surveyed by S&P Global said export demand was strong from Asia, Europe and South America.

As manufacturers took on more business, "staffing levels meanwhile expanded solidly, and to the highest degree since February 2022," S&P Global said.

The Spanish government expects economic growth to slow to a still solid 2% this year, from 2.5% last year. (Reporting by Inti Landauro; Editing by Susan Fenton)