Romania’s manufacturing sector showed signs of stabilisation in September, with the BCR Romania Manufacturing Purchasing Managers’ Index (PMI, chart) rising to 49.8, its highest level in 15 months, according to data from Erste Group.

The figure, up from 49.3 in August, remains marginally below the neutral 50 mark, signalling only a slight contraction in activity.

The latest PMI reading follows a period of gradual recovery in Romania’s industrial sector. Industrial production rose by 4% year on year in the May to July period, with core manufacturing output increasing by 4.5%, according to the latest available data.

The continued improvement in the PMI suggests that the sector is moving closer to stabilisation after facing prolonged weakness following the onset of the war in Ukraine.

Erste Group reported that all components of the PMI made small positive or negative contributions in September.

The output component improved but remained marginally in contraction territory for the sixteenth consecutive month, reflecting ongoing challenges in production volumes despite signs of stronger customer demand.

The new orders and new export orders components both exceeded the neutral 50 level, indicating a rise in demand, particularly from European Union markets. Erste Group noted that while subdued client budgets and persistent price pressures continue to weigh on activity, the increase in new business orders is a positive signal for the months ahead.

Future business expectations strengthened further in September, with optimism supported by greater export volumes and expectations of improved market conditions.

However, the employment component of PMI stayed in contraction territory, showing only a minor uptick from the previous month, suggesting that companies remain cautious about expanding their workforce.

“The rising demand can only be a good sign looking ahead,” Erste Group said, highlighting the potential for Romania’s industrial recovery to gain further momentum if current trends continue.