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The recent pressure on emerging markets is exaggerating the disparity in rates of economic recovery in Central and Eastern Europe. January PMI numbers illustrated that, with Central Europe continuing to see growth ramp up, while Russia and Turkey struggle.

Some analysts expected the onslaught on emerging markets to dent confidence across the region, but the purchasing managers index for last month saw manufacturing conditions in the Czech Republic, Hungary and Poland improve to their strongest levels seen since early 2011. In contrast, manufacturing conditions deteriorated in CEE's largest economies Turkey and Russia, the latter putting in its worst reading for close to five years.

Standing behind the Central European boost is continued growth in Eurozone manufacturing, which is responsible for a huge chunk of export demand out of the region. Germany in particular dictates the fortunes of Central European factories, and it saw its PMI push to a 32-month high of 56.5. The 50-point threshold divides contraction from expansion.

"Germany's manufacturing sector moved up a gear at the beginning of 2014, with production levels and order intakes expanding at a pace not seen for almost three years," notes Oliver Kolodseike, an economist at data compiler Markit. At 54.0, the Eurozone PMI reading saw its strongest rate of expansion since May 2011.

Currency boost

The downward pressure on the currencies of Central Europe from the EM selloff is also likely to have helped exports to the Eurozone. "Weaker central European currencies will additionally support foreign sales ... in the months to come," claimed Michal Dybula at BNP Paribas, according to Reuters.

The Czech Republic is the most heavily reliant on export demand from Europe of the three Central European economies. Pushing to 55.9, the country's PMI reading rose for the eighth time in the last ten months, and signalled the fastest increases in output, new orders and purchasing since April 2011.

In similar fashion, Poland's reading of 55.4 signalled the strongest overall improvement in operating conditions since January 2011. Adding to the promise for an economy in which domestic demand plays a greater role than any other in the region, the rate of workforce growth was the strongest since the survey started in 1998, suggesting Poland's problematic employment picture could start to clear up, allowing wages to rise and people to start spending once more.

"The record high rate of job creation in January is a particularly positive indicator, implying stability of the current improvement," writes Agata Urbanska-Giner at HSBC. "The above-expectation PMI reading will also fit in with recent upbeat comments from policymakers, including several MPC members, on a positive GDP growth outlook."

Seen as less of a reliable guide to actual manufacturing data due to its local compilation, Hungary's PMI jumped to an all-time high of 57.9 in January. "Nevertheless," analysts at RBS point out, "the trend of the data has been positive and has remained in expansionary territory for six consecutive months, marking the longest such stretch since mid-2011. This is perhaps reflective of improving growth dynamics in Hungary, in some part thanks to the Funding for Growth Scheme, which is targeted at SMEs, but perhaps more importantly due to improving external market conditions."

Still struggling

By way of contrast, caught in the eye of the financial market storm in January, Russia and Turkey saw their recent poor runs in PMI readings worsen as they descended with quite a bump.

Turkey is in the midst of political crisis that provoked a sharp drop for the lira in January, and the ongoing troubles are scaring investors and denting confidence among business and consumers. Still, the PMI reading managed to remain in positive territory for January, although it fell to 52.7 from 53.5 the month before - the lowest level since August 2013.

However, analysts suggest the reality on the ground may be worse than it looks. The reading "wasn't as bad as might have been expected, given the political crisis and fall in the lira since the middle of December," comments William Jackson at Capital Economics. "That being said, since the survey was conducted during the middle of last month, it won't have captured the very sharp fall in the currency at the start of last week that forced the central bank to tighten monetary policy aggressively."

RBS is of the same mind. "Surveys show real sector confidence index has fallen to its lowest level since September 2012, whilst consumer confidence is also hovering close to multi-annual lows," the analysts note. "We expect further deterioration on all these accounts as political uncertainty mounts as we draw closer to end-March local elections and as the impact of central bank tightening starts to bite on real economic activity."

Russia, meanwhile, appears to have been given no slack, recording its greatest deterioration in the manufacturing sector since the midst of the crisis in June 2009. At just 48.0, the PMI reading came in below the 50-point threshold for the sixth time in seven months, indicating an ongoing downturn.

Cementing the dim outlook, nearly every category within the reading hit multi-year lows. "Notably, manufacturing output decreased for the first time since July last year. In conjunction with the reported decline in new orders, ongoing cuts in staffing, faster suppliers' delivery times and a stronger rise in output prices, the overall picture in manufacturing looks pretty gloomy," writes Alexander Morozov at HSBC.

"The free-fall in PMIs comes amidst sharp currency weakening, with ruble now at its weakest level vs. USD since Q1 2009," points out RBS. "The rate hikes in Turkey and South Africa has led to speculation that Russia may be next.