Czech Republic: Manufacturing PMI slips to an over two-year low in November
December 3, 2018
The manufacturing Purchasing Managers’ Index (PMI) produced by IHS Markit slipped from 52.5 in October to 51.8 in November, the fifth consecutive monthly fall and the lowest reading in over two years. Nevertheless, the PMI remained above the critical 50-point mark separating expansion from contraction in activity in the manufacturing sector.
November’s drop mainly reflected slower output growth and the first decline in new orders in over two years. Growth in production eased to an over two-year low amid subdued demand at home and abroad, while the contraction in new orders was largely driven by the introduction of new emission standards in the auto sector. On the price front, although input costs continued to rise sharply, output charge inflation moderated to an over one-year low, primarily due to the overall deterioration in demand conditions. Lastly, optimism among manufacturers dropped to the lowest point in nearly six years in November, as concerns over future demand and growth in the auto industry weighed on their outlook.
Author: Javier Colato, Economist