Poland: Manufacturing sector contracts at sharper pace in September
The manufacturing Purchasing Managers’ Index (PMI), released by IHS Markit, dropped to 47.8 points in September (August: 48.8 points). The index thus moved further below the 50-threshold that separates contraction from expansion in the manufacturing sector, below which it has been since November 2018.
September’s deterioration was underpinned by steeper declines in output and new orders, both of which contracted for the 11th consecutive month, and at a faster pace than in August—the pace of contraction in new orders was the joint-fastest in over ten years, besides. Lower domestic and external demand were behind the decline, with orders from abroad dragged down by faltering demand from Western Europe, including Germany and France. Meanwhile, businesses’ expectations on production fell to a record-low due to a weak demand outlook for Europe and strong competition from Asia, and firms reduced backlogs at a sharp pace. To conclude, input inflation accelerated, while output prices were unchanged adding pressure to profit margins.