Polish manufacturing regains growth momentum in JuneStaff Writer | July 5, 2018
The latest PMI survey data for June signalled the strongest overall performance of Poland’s manufacturing sector since the start of 2018.
Europe Pressure on capacity remained
Pressure on capacity remained, as backlogs rose further and suppliers’ delivery times lengthened markedly.
Cost pressures also intensified, as average input prices rose at the strongest rate since April 2011.
The headline IHS Markit Poland Manufacturing PMI is a composite single-figure indicator of manufacturing performance.
It is derived from indicators for new orders, output, employment, suppliers’ delivery times and stocks of purchases.
Any figure greater than 50.0 indicates overall improvement of the sector.
The PMI rose from May’s nine-month low of 53.3 to 54.2 in June, signalling strong overall growth of the Polish manufacturing sector.
That latest reading was the highest in five months and extended the current survey-record expansionary sequence to 45 months.
The rise in the PMI in June reflected faster rates of expansion in new orders, output and employment.
Manufacturing output growth accelerated in June.
The rate of expansion was broadly in line with the strong trend shown over the current growth phase of 23 months.
The strengthening in output growth reflected a faster increase in new orders.
The pace of growth in new work was the strongest in four months, with firms commenting on positive domestic demand.
New export business increased modestly having declined slightly in May.
With workloads rising, manufacturers sought to boost headcounts.
Employment in the sector increased at the fastest rate since April 2017, and was among the strongest recoded since the series began in June 1998.
That said, some firms continued to report staff shortages.
Survey data highlighted growing pressure on manufacturing capacity in June.
Backlogs of work increased further, and suppliers’ delivery times lengthened.
Demand for inputs rose as the volume of purchasing activity undertaken by manufacturers increased at the fastest rate in 2018 so far.
Price pressures intensified in June.
The rate of input price inflation strengthened for the third month running to the highest since April 2011, reflecting increased metal prices in particular.
In turn, prices charged by Polish manufacturers for their finished goods increased at the strongest rate since January.
The 12-month outlook for Polish manufacturing output remained positive in June, linked to the introduction of more efficient machinery and expected new business wins.
That said, the strength of sentiment eased to the joint-weakest in 19 months. ■