The S&P Global Manufacturing Purchasing Managers’ Index (PMI) stood at 42.1 in July from 44.4 in June. The index slipped below the 50 threshold, signaling a sharper deterioration in business conditions than the previous month.
Output and new orders fell sharply in July due to contraction in domestic and foreign demand, high inflation and an uncertain economic outlook. Moreover, employment has been declining for the second month in a row. Both production costs and product prices continued to rise significantly. At the same time, the growth rates of both prime cost and product prices were more moderate than in June. Finally, company sentiment turned negative for the future, falling to its lowest level since April 2020, on growing fears of an impending recession.
Commenting on the results of the latest survey, Paul Smith, an analyst at S&P Global, said:
“Poland’s manufacturing sector experienced an alarmingly sharp deterioration in performance in July. We should be under no illusions about the extent and speed of the decline that is taking place: the performance of the index, both in terms of output and new orders, has only been outperformed to a minimum. disadvantage during times of high stress (global financial crisis and pandemic).”
FocusEconomics experts expect fixed investment to increase by 6.2% in 2022, down 0.5 percentage points from last month’s forecast. In 2023, the group expects fixed investment growth of 6.3%.