Czech Manufacturing PMI Hits Over 3-Year High

The Czech Manufacturing PMI slipped to 49.8 in January 2026 from 50.4 in the previous month, returning to contraction and missing market expectations of 50.6. The slowdown was driven by a renewed fall in new orders amid weak domestic and export demand, particularly from Germany, and tough global competition. Employment and purchasing activity declined as firms cut costs, while inventories fell due to stock optimisation. Despite softer demand, output rose at the fastest pace since February 2022, supported by efforts to clear backlogs, which increased for the first time in three months. Inflationary pressures intensified, with input costs rising at the sharpest pace in three years on higher supplier, raw material, and carbon-related certification costs, prompting firms to raise selling prices at the steepest rate since February 2023. Nonetheless, business confidence climbed to its highest level since June 2025, supported by expectations of stronger demand and planned tech investment.

The S&P Global Czechia Manufacturing PMI rose to 50.4 in December 2025 from 48 in November, beating market expectations of 48, and ending a five-month contraction. This marked the strongest reading since May 2022, driven by renewed increases in new orders, production, and employment, supported by firmer domestic and export demand. Employment expanded for the first time in 39 months, helping reduce order backlogs. On prices, input price inflation accelerated to the fastest since May, driven by higher metals and material costs, while output price growth softened amid foreign competition. Firms slowed cuts to input buying, inventories continued to fall, and supplier delivery times lengthened. Business confidence rose to a three-month high, supported by export expansion, despite lingering concerns over subdued demand conditions.

The S&P Global Czechia Manufacturing PMI rose to 48.0 in November 2025 from 47.2 in October, signaling a modest easing in the pace of contraction. Output fell at the fastest rate since January, weighed down by sustained declines in new orders and supply chain disruptions, particularly for inputs affected by China’s export controls. Total new sales declined, but the drop softened amid a renewed rise in new export orders, the first increase since February 2022, driven by efforts to diversify client bases. Firms cut employment and purchasing activity further, while pre-production and finished goods inventories were depleted. On prices, input costs rose at the fastest pace since July, prompting a marginal increase in selling prices, the first since May. Business confidence remained historically muted but improved slightly from October, with firms anticipating modest output growth over the year ahead.