Czech PMI manufacturing index is rising

The improving conditions in the Czech industry were confirmed by the January PMI manufacturing index which increased 1,2 percentage points to 55,9 percent, up from 54,7 percent in December, Markit Economics, a specialist compiler of business surveys and economic indices, announced.

The PMI is based on data compiled from monthly replies to questionnaires sent to purchasing executives in over 250 manufacturing companies. It is a composite index based on five of the individual indexes: New Orders, Output, Employment, Suppliers’ Delivery Times, Stock of Items Purchased.

The output in Czech industry is strongest since April 2011, new export orders rose at the strongest rate since June 2010 (at 43-month record).

It is necessary to be cautious in evaluating these results, the Confederation of Industry analyst Bohuslav Čížek said. A strong and stable growth of the whole Czech economy can‘t be expected for some time yet. Nevertheless, the increasing export orders show that the industrial production will rise in the next months and will represent one of the positive factors in the Czech economy development.

The Confederation of Industry expects that the Czech GDP will grow by 1,2-1,6 percent this year.

A PMI manufacturing index reading above 50 indicates an overall increase in that variable, below 50 an overall decrease.