Czech Republic: Manufacturing PMI virtually unchanged in January
The IHS Markit Manufacturing Purchasing Managers’ Index (PMI) dipped to 59.0 in January from December’s 59.1. Therefore, the index remained comfortably above the 50-threshold, signaling another strong improvement in business conditions from the previous month.
January’s reading chiefly reflected faster increases in output and new orders in the context of persisting but easing supply chain disruptions. Moreover, companies hired additional staff and purchasing activity also increased. On the price front, input cost inflation accelerated due to higher costs for energy, raw materials and transportation. Output cost inflation accelerated in turn, logging a record-high increase. Lastly, sentiment regarding the outlook improved amid strong demand projections.
Commenting on the release, Sian Jones, senior economist at IHS Markit, stated:
“Less marked extensions to delivery times were not reflected in cost inflation, which accelerated amid higher material and energy prices. Firms were able to continue passing through greater costs to clients, however, as output charges rose at a series record pace. Inflationary pressures are expected to remain substantial throughout the opening quarter of 2022, with further hikes in interest rates anticipated over the coming months as the Czech National Bank seeks to control the surge in inflation.”