Poland: Manufacturing sector starts 2020 on a sour note
The manufacturing Purchasing Managers’ Index (PMI), released by IHS Markit, dipped to 47.4 in January from December’s 48.0. The index thus moved further below the 50-threshold, where it has been since November 2018, signaling a more pronounced deterioration in the manufacturing sector.
January’s more marked contraction was underpinned by a sharper decline in workforce, which dropped at the fastest pace since October 2009. That said, new orders fell at the softest pace since August, while the pace of contraction in output stabilized at a modest level. Moreover, businesses’ expectations strengthened and hit an eight-month high, although sentiment was stuck at a sub-trend level. On the price front, input price inflation came in at one of the softest paces in three years, while output prices increased at a faster pace than in the previous month.
Commenting on the release, Trevor Balchin, economics director at IHS Markit, stated:
“Data on new orders and future output were more encouraging […]. This could reflect a slowing manufacturing downturn in Germany – by far Poland’s largest export market – according to the January flash PMI data. Nevertheless, a return to improving business conditions looks some way off.”