Czech PMI deteriorates in April

Czech PMI deteriorates in April
/ bne IntelliNews
By Albin Sybera May 3, 2024

The Manufacturing Purchasing Managers’ Index (PMI) for Czechia, compiled by market intelligence company S&P Global, posted 44.7 in April. This is down on 46.2 in March and well below the 50-point mark.

S&P highlighted stronger contractions in production and weak client demand amid the burdens of the difficult manufacturing environment, which was also pressured by waning external demand, most notably from Germany, a key export destination.

“Operating conditions at Czech manufacturers took a turn for the worse at the beginning of the second quarter, as weak demand dragged further on new orders and output,” commented Sian Jones, principal economist at S&P Global Market Intelligence.    

“Contractions in production and new sales accelerated, as firms made cutbacks in response. Employment fell at a sharper pace, with a marked drop in input buying reflecting broader efforts to destock,” she continued.

S&P also noted that selling prices rose slightly for the first time in a year and that a drop in new sales was the second-slowest in 21 months. The current sequence of decline now stretches to just over two years.

Manufacturers also cut staff in an effort to address the rising costs. “Higher energy and food prices were reportedly the key drivers of the increase in cost burdens, alongside unfavourable exchange rate movements against the euro,” she said.

Despite the slip from the March figure, the confidence rate was the second-highest in two years.