Czech PMI continues to inch upward in March

Czech PMI continues to inch upward in March
The Czech PMI figures continued their steady recovery in March. / bne IntelliNews
By bne IntelliNews April 2, 2024

Czechia’s Manufacturing Purchasing Managers’ Index (PMI), compiled by market intelligence company S&P Global, continued to inch upward in March, posting 46.2.

This is up from 44.3 in February and from 43.0 in January and the fourth month of consecutive upward development, although it remains below the 50-point mark, separating growth and decline.   

“March PMI data signalled a further deterioration across the Czech manufacturing sector, but the pace of decline eased notably to the least marked since August 2022,” commented Sian Jones, principal economist at S&P Global Market Intelligence.

Jones pointed out  “challenging economic conditions in Germany” as “weighing further on manufacturing orders and output. Underlying data suggested that challenges remained in supply chains as firms had to re-route shipments of inputs from Asia to avoid disruption in the Red Sea,” he said.

Despite the challenges, S&P Global reported that business confidence had improved “to the strongest in just over two years”. Input costs increased fastest since February 2023 while selling prices continued to fall in a drive for new sales.

New orders contracted at “the softest pace since June 2022”, S&P Global also stated, noting a downturn in the construction sector. Cuts in employment occurred at the slowest in 18 months, but the overall decline stretched further to over two years.

Jones concluded by pointing out the highest confidence among firms in over two years. “Hopes of a rebound in new orders drove optimism. Our current forecast for industrial production expects a rise of 2.8% in 2024m,” he said.