Czech manufacturing PMI data from S&P Global market intelligence company posted 43.2 in November.
This is up from 42 in October but still indicates deteriorating conditions and a challenging market environment. The index deterioration run stretches back to June 2022, although it was slowest since March in November.
“Czech manufacturers continued to see a decline in the sector’s health in November, but some glimmers of light emerged as output, new orders and employment all fell at softer rates,” commented Sian Jones, principal economist at S&P.
Companies continued to cut workforce numbers and reduce their spending on inputs even though business confidence picked up to a three-month high.
Weakened external demand, especially from Germany, towards which a large part of the Czech economy is oriented, led to another significant drop in new export orders.
Companies reduced their selling prices for the seventh month in a row in November.
“Lower global demand for inputs resulted in more widespread comments regarding supplier discounts, as overall cost burdens fell at a quicker pace,” Jones noted.
S&P does not expect the Czech central bank (CNB) to change its policy of maintaining the 7% interest rate but still anticipates rate cuts in the first quarter of 2024.