Czech Republic: Manufacturing PMI drifts higher in July but remains weak on continued Covid-19 woes
August 3, 2020
The manufacturing Purchasing Managers’ Index (PMI), produced by IHS Markit, rose to 47.0 in July from 44.9 in June, marking the softest decline since March 2019. Despite the increase, however, the index remained below the critical 50-mark separating deterioration from improvement in the health of the manufacturing sector, where it has been for over a year.
July’s increase was driven by the first expansion in output since January 2019 as well as by a less pronounced fall in new orders as more factories reopened following the pandemic-induced shutdown. That said, the demand environment remained complicated, leading manufacturers to reduce their staffing levels further in July. On the price front, although input cost inflation was the fastest in over one year, goods producers lowered selling prices again amid downbeat client demand. Lastly, business sentiment strengthened on hopes of higher output ahead.